Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 18, 2020 | |
Document and Entity Information | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-33190 | |
Entity Registrant Name | MCEWEN MINING INC. | |
Entity Incorporation, State or Country Code | CO | |
Entity Tax Identification Number | 84-0796160 | |
Entity Address, Address Line One | 150 King Street West | |
Entity Address, Address Line Two | SuiteĀ 2800 | |
Entity Address, City or Town | Toronto | |
Entity Address, State or Province | ON | |
Entity Address, Country | CA | |
Entity Address, Postal Zip Code | M5H 1J9 | |
City Area Code | 866 | |
Local Phone Number | 441-0690 | |
Title of 12(b) Security | Common stock, no par value | |
Trading Symbol | MUX | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 400,398,425 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0000314203 | |
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
REVENUE: | ||
Revenue | $ 31,400 | $ 15,583 |
OPERATING EXPENSES: | ||
Production costs applicable to sales | (28,387) | (11,148) |
Depreciation and depletion | (6,698) | (3,006) |
Gross (loss) profit | (3,685) | 1,429 |
OTHER OPERATING EXPENSES: | ||
Advanced projects | (2,550) | (2,647) |
Exploration | (3,790) | (4,150) |
General and administrative | (2,064) | (2,261) |
Loss from investment in Minera Santa Cruz S.A. (note 9) | (2,676) | (2,310) |
Depreciation | (115) | (152) |
Revision of estimates and accretion of asset retirement obligations (note 11) | (660) | (461) |
Impairment of mineral property interests and plant and equipment (note 8) | (83,805) | |
Operating loss | (99,345) | (10,552) |
OTHER INCOME (EXPENSE): | ||
Interest and other finance expense, net | (1,877) | (513) |
Other income (note 4) | 937 | 1,047 |
Total other income (expense) | (940) | 534 |
Loss before income and mining taxes | (100,285) | (10,018) |
Income and mining tax recovery (expense) | 1,094 | (118) |
Net loss | $ (99,191) | $ (10,136) |
Net loss per share (note 13): | ||
Basic and Diluted (in dollars per share) | $ (0.25) | $ (0.03) |
Weighted average common shares outstanding (thousands) (note 13): | ||
Basic and Diluted (in shares) | 400,370 | 338,557 |
Gold and silver sales | ||
REVENUE: | ||
Revenue | $ 31,400 | $ 15,583 |
Production costs applicable to sales | ||
OPERATING EXPENSES: | ||
Production costs applicable to sales | $ (28,387) |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 28,774 | $ 46,452 |
Investments (note 5) | 875 | 1,885 |
Receivables, prepaids and other assets (note 6) | 5,138 | 5,265 |
Inventories (note 7) | 38,327 | 38,376 |
Total current assets | 73,114 | 91,978 |
Mineral property interests and plant and equipment, net (note 8) | 333,651 | 418,791 |
Investment in Minera Santa Cruz S.A. (note 8) | 107,507 | 110,183 |
Inventories, long-term (note 7) | 8,685 | 9,603 |
Other assets | 669 | 668 |
TOTAL ASSETS | 523,626 | 631,223 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 27,805 | 34,070 |
Debt, current portion (note 10) | 8,000 | 5,000 |
Debt to related party, current portion (note 10) | 8,000 | 5,000 |
Lease liabilities, current portion | 2,117 | 2,115 |
Asset retirement obligation, current portion (note 11) | 1,905 | 2,610 |
Total current liabilities | 47,827 | 48,795 |
Lease liabilities, long-term | 4,356 | 5,018 |
Debt (note 10) | 16,799 | 19,758 |
Debt to related party (note 10) | 16,799 | 19,758 |
Asset retirement obligation, long-term (note 11) | 29,998 | 29,591 |
Other liabilities | 3,604 | 3,910 |
Deferred income and mining tax liability | 3,805 | 4,914 |
Total liabilities | 123,188 | 131,744 |
Shareholders' equity: | ||
Common stock and additional paid-in capital, no par value, 500,000 shares authorized (in thousands); Common: 400,399 as of March 31, 2020 and 400,339 as of December 31, 2019 issued and outstanding (in thousands) (note 12) | 1,530,852 | 1,530,702 |
Accumulated deficit | (1,130,414) | (1,031,223) |
Total shareholders' equity | 400,438 | 499,479 |
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | $ 523,626 | $ 631,223 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
CONSOLIDATED BALANCE SHEETS | ||
Common stock, par value | $ 0 | $ 0 |
Common stock, shares authorized | 500,000 | 500,000 |
Common, shares issued | 400,399 | 400,339 |
Common, shares outstanding | 400,399 | 400,339 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common Stock and Additional Paid-in Capital | Accumulated Deficit | Total |
Balance at Dec. 31, 2018 | $ 1,457,422 | $ (971,476) | $ 485,946 |
Balance (in shares) at Dec. 31, 2018 | 344,560,000 | ||
Increase (Decrease) in Shareholders' Equity | |||
Stock-based compensation | $ 61 | 61 | |
Exercise of stock options | $ 223 | $ 223 | |
Exercise of stock options (in shares) | 222,000 | 221,500 | |
Units Issued for cash, net of share issue cost | $ 20,252 | $ 20,252 | |
Units Issued for cash, net of share issue cost (in shares) | 14,194,000 | ||
Shares issued for acquisition of mineral property interests | $ 1,851 | 1,851 | |
Shares issued for acquisition of mineral property interests (in shares) | 1,010,000 | ||
Net loss | (10,136) | (10,136) | |
Balance at Mar. 31, 2019 | $ 1,479,809 | (981,612) | 498,197 |
Balance (in shares) at Mar. 31, 2019 | 359,986,000 | ||
Balance at Dec. 31, 2019 | $ 1,530,702 | (1,031,223) | 499,479 |
Balance (in shares) at Dec. 31, 2019 | 400,339,000 | ||
Increase (Decrease) in Shareholders' Equity | |||
Stock-based compensation | $ 88 | 88 | |
Exercise of stock options | $ 62 | $ 62 | |
Exercise of stock options (in shares) | 60,000 | 60,000 | |
Net loss | (99,191) | $ (99,191) | |
Balance at Mar. 31, 2020 | $ 1,530,852 | $ (1,130,414) | $ 400,438 |
Balance (in shares) at Mar. 31, 2020 | 400,399,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net loss | $ (99,191) | $ (10,136) |
Adjustments to reconcile net loss from operating activities: | ||
Impairment of mineral property interests and plant and equipment (note 8) | 83,805 | |
Loss from investment in Minera Santa Cruz S.A., net of amortization (note 9) | 2,676 | 2,310 |
Depreciation and amortization | 6,757 | 3,186 |
Loss (gain) on investments (note 5) | 898 | (827) |
Income and mining tax (recovery) expense | (1,094) | 118 |
Stock-based compensation | 88 | 61 |
Revision of estimates and accretion of asset retirement obligations (note 11) | 660 | 461 |
Foreign exchange (gain) loss | (868) | 301 |
Change in non-cash working capital items: | ||
Decrease (increase) in other assets related to operations | 1,234 | (5,875) |
(Decrease) in liabilities related to operations | (6,873) | (420) |
Cash used in operating activities | (11,908) | (10,821) |
Cash flows from investing activities: | ||
Additions to mineral property interests and plant and equipment | (5,503) | (16,512) |
Proceeds from sale of investments (note 5) | 112 | |
Dividends received from Minera Santa Cruz S.A. (note 9) | 2,020 | |
Cash used in investing activities | (5,391) | (14,492) |
Cash flows from financing activities: | ||
Proceeds from sale of units, net of share issue costs (note 12) | 20,252 | |
Proceeds of at-the-market common stock issuance (note 12) | 1,851 | |
Proceeds of exercise of stock options | 62 | 223 |
Payment of finance lease obligations | (555) | (448) |
Cash (used in) provided by financing activities | (493) | 21,878 |
Effect of exchange rate change on cash and cash equivalents | 114 | (337) |
(Decrease) in cash, cash equivalents and restricted cash | (17,678) | (3,772) |
Cash, cash equivalents and restricted cash, beginning of period | 46,500 | 30,489 |
Cash, cash equivalents and restricted cash, end of period (note 17) | 28,822 | 26,717 |
Supplemental disclosure of cash flow information: | ||
Interest paid | (1,289) | (1,316) |
Interest received | $ 135 | $ 3 |
NATURE OF OPERATIONS AND BASIS
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | 3 Months Ended |
Mar. 31, 2020 | |
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | |
NATURE OF OPERATIONS AND BASIS OF PRESENTATION | NOTE 1 NATURE OF OPERATIONS AND BASIS OF PRESENTATION McEwen Mining Inc. (the āCompanyā) was organized under the laws of the State of Colorado on July 24, 1979. The Company is engaged in the exploration, development, production and sale of gold and silver and exploration for copper. The Company operates in the United States, Canada, Mexico and Argentina. The Company owns a 100% interest in the Gold Bar gold mine in Nevada, the Black Fox gold mine in Ontario, Canada, the El Gallo Project and the Fenix silver-gold project in Sinaloa, Mexico, the Los Azules copper deposit in San Juan, Argentina and a portfolio of exploration properties in Nevada, Canada, Mexico and Argentina. It also owns a 49% interest in Minera Santa Cruz S.A. (āMSCā), owner of the producing San JosĆ© silver-gold mine in Santa Cruz, Argentina, which is operated by the joint venture majority owner, Hochschild Mining plc. The interim consolidated financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (āSECā) and are unaudited. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (āU.S. GAAPā) 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 managementās opinion, the unaudited Consolidated Statements of Operations and Comprehensive Loss Statement of Operations Consolidated Balance Sheets Consolidated Statement of Changes in Shareholdersā Equity Consolidated Statements of Cash Flows |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 SIGNIFICANT ACCOUNTING POLICIES Risks and Uncertainties COVID-19 On March 11, the World Health Organization (āWHOā) declared the COVID-19 virus a global pandemic. As a result of the pandemic, many jurisdictions, including the United States (āUSā), some of its political subdivisions, Canada, Mexico and Argentina, instituted restrictions on travel, public gatherings and certain business operations. This lead to significant adverse effects on the Companyās operations. During late March and early April, all the Companyās operations were disrupted by temporary shutdowns to protect its workforce from the spread of the virus. During the shutdowns, rigorous policies and procedures were implemented at each site to minimize potential health and safety risks to the workforce. ā The temporary shutdowns will adversely impact the Companyās operations, cash flow, and liquidity in the second quarter of 2020. However, the full impact of the COVID normal capacity can be sustained and whether ongoing operating costs will be adversely affected. Depending on the length and severity of the outbreak, the Companyās liquidity and financial condition may be adversely affected and the Company may be at an increased risk of default under its debt agreements. Achieving normal operating capacity is also dependant on the continued availability of supplies, which is out of the Companyās control. Management is actively monitoring the global situation on its financial condition, liquidity, operations, suppliers, industry and workforce . As of May 18, 2020, the date on which these financial statements were authorized for issuance, the global situation remains uncertain. The governments of the US, Canada, Mexico and Argentina have enacted or proposed legislation to provide relief to companies and/or individuals affected by the enforced reduction in operations. The Company is in the process of applying for available relief. It is highly uncertain if the Company would qualify for funding under these relief programs, and if the Company does qualify, how much funding would be available. Going Concern In the preparation of the interim financial statements, management is required to identify when events or conditions indicate that substantial doubt may exist about the Companyās ability to continue as a going concern. Substantial doubt about the Companyās ability to continue as a going concern would exist when relevant conditions and events, considered in aggregate, indicate that the Company may not be able to meet its obligations as they become due for a period of at least, but not limited to, 12 months from the balance sheet date. When the Company identifies conditions or events that raise potential for substantial doubt about its ability to continue as a going concern, the Company considers whether its plans that are intended to mitigate those relevant conditions or events will alleviate the potential substantial doubt. ā The Company is in full compliance with financial covenants under its outstanding credit agreement as at March 31, 2020. However, as a result of the expected significant resource reduction at the Gold Bar mine, resulting in an initial revised mine plan which yields less cash flow coupled with the disruptions to operations caused by the COVID-19 pandemic, there is uncertainty about the Companyās ability to remain in compliance with certain of these financial covenants over the next twelve months. Non-compliance with these covenants would result in a breach under the Companyās debt agreement and the lenderās right to accelerate the balance due under the agreement. In response to this uncertainty, the Company is in discussions with its lenders to seek relief from certain of these financial covenants and evaluating options to re-finance the debt, raise additional equity, and curtail discretionary expenditures. The Companyās ability to continue as a going concern is dependent on the successful completion of one or more of these initiatives to ensure that it has sufficient liquidity available to satisfy these financial covenants and in order to fund its operations. After considering these plans, management has concluded that it has mitigated the risk of material uncertainties relating to events or conditions that may cast substantial doubt upon the Companyās ability to continue as a going concern for a period of 12 months from the consolidated balance sheet date. The estimates used by management in reaching this conclusion are based on information available as at the date these financial statements were authorized for issuance, and include internally generated cash flow forecasts. Accordingly, actual results could differ from these estimates and resulting variances may be material to managementās assessment. Recently Adopted Accounting Pronouncements Changes to the Disclosure Requirements for Fair Value Measurement: Recently Issued Accounting Pronouncements Income Taxes: is effective for the Company for the fiscal years beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the effect of this amendment and the impact it may have on the Companyās consolidated financial statements. Reclassifications Certain amounts in the comparative Statement of Operations Advanced projects Statement of Operations Exploration Statement of Operations General and Administrative Statement of Operations |
OPERATING SEGMENT REPORTING
OPERATING SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2020 | |
OPERATING SEGMENT REPORTING | |
OPERATING SEGMENT REPORTING | NOTE 3 OPERATING SEGMENT REPORTING McEwen Mining Inc. is engaged in the exploration, development, production and sale of gold and silver and exploration for copper, with operations located in the United States, Canada, Mexico and Argentina. The Companyās chief operating decisions maker (āCODMā) reviews the operating results, assesses performance and makes decisions about allocation of resources to these segments at the geographic region level or major mine/project where the economic characteristics of the individual mines or projects are not alike. As a result, these operating segments also represent the Companyās reportable segments. The Companyās business activities that are not considered operating segments are included in General and Administrative and other The CODM reviews segment income (loss) defined as gold and silver sales less production costs applicable to sales, depreciation and depletion, advanced projects and exploration costs for all segments except for the MSC segment which is evaluated based on the attributable equity income or loss. Gold and silver sales and production costs applicable to sales for the reportable segments are reported net of intercompany transactions. Production costs applicable to sales for the El Gallo project of $4.2 million for the three months ended March 31, 2020 (same period in 2019 - $4.5 million) include $1.7 million of residual leaching spending in the period, net of $1.1 million capitalized on inventory (same period in 2019 - $1.8 million, net of $1.1 million capitalized on inventory) with the rest representing costs recorded in the leach pad inventory balances in prior periods. Capital expenditures include costs capitalized in mineral property interests and plant and equipment in the respective periods. ā Significant information relating to the Companyās reportable operating segments is summarized in the tables below: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, 2020 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ 14,317 ā $ 12,739 ā $ 4,344 ā $ ā ā $ ā ā $ 31,400 Production costs applicable to sales ā ā (17,032) ā ā (7,207) ā ā (4,148) ā ā ā ā ā ā ā (28,387) Depreciation and depletion ā ā (3,862) ā ā (2,748) ā ā (88) ā ā ā ā ā ā ā ā (6,698) Gross (loss) profit ā ā (6,577) ā ā 2,784 ā ā 108 ā ā ā ā ā ā ā ā (3,685) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (366) ā ā (1,066) ā ā (1,118) ā ā ā ā ā ā ā (2,550) Exploration ā ā (809) ā ā (2,405) ā ā ā ā ā ā ā ā (576) ā ā (3,790) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (2,676) ā ā ā ā (2,676) Impairment of mineral property interests and plant and equipment (note 8) ā ā (83,805) ā ā ā ā ā ā ā ā ā ā ā ā ā ā (83,805) Segment loss ā $ (91,557) ā $ (687) ā $ (1,010) ā $ (2,676) ā $ (576) ā $ (96,506) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (3,779) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (100,285) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 1,807 ā ā 3,729 ā ā ā ā ā ā ā ā ā ā $ 5,536 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, 2019 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ 842 ā $ 8,943 ā $ 5,798 ā $ ā ā $ ā ā $ 15,583 Production costs applicable to sales ā ā (808) ā ā (5,835) ā ā (4,505) ā ā ā ā ā ā ā ā (11,148) Depreciation and depletion ā ā (152) ā ā (2,710) ā ā (144) ā ā ā ā ā ā ā ā (3,006) Gross (loss) profit ā ā (118) ā ā 398 ā ā 1,149 ā ā ā ā ā ā ā ā 1,429 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (195) ā ā ā ā ā (2,452) ā ā ā ā ā ā ā ā (2,647) Exploration ā ā (613) ā ā (2,420) ā ā ā ā ā ā ā ā (1,117) ā ā (4,150) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (2,310) ā ā ā ā ā (2,310) Segment (loss) ā $ (926) ā $ (2,022) ā $ (1,303) ā $ (2,310) ā $ (1,117) ā $ (7,678) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (2,340) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (10,018) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 13,008 ā $ 3,343 ā $ ā ā $ ā ā $ ā ā $ 16,351 ā ā Geographic information Geographic information includes the long-lived assets balance and revenues presented for the Companyās operating segments, as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Long-lived Assets ā Revenue (1) ā ā ā March 31, ā December 31, ā Three months ended March 31, ā ā 2020 2019 2020 ā 2019 ā USA ā $ 50,599 ā $ 135,854 ā $ 14,317 ā $ 842 ā Canada ā ā 78,505 ā ā 77,147 ā ā 12,739 ā ā 8,943 ā Mexico ā ā 21,457 ā ā 23,551 ā ā 4,344 ā ā 5,798 ā Argentina (2) ā ā 298,997 ā ā 302,598 ā ā ā ā ā ā ā Total consolidated (3) ā $ 449,558 ā $ 539,150 ā $ 31,400 ā $ 15,583 ā (1) Presented based on the location from which the product originated. (2) Includes Investment in MSC of $107.5 million as of March 31, 2020 (December 31, 2019 ā $110.2 million). (3) Total excludes $0.9 million related to the Company's office lease asset as the business activities related to corporate are not considered to be a part of the operating segments . |
OTHER INCOME
OTHER INCOME | 3 Months Ended |
Mar. 31, 2020 | |
OTHER INCOME | |
OTHER INCOME | NOTE 4 OTHER INCOME The following is a summary of other income for the three months ended and 2019 : ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, ā ā 2020 2019 ā Unrealized and realized (loss) gain on investments (note 5) ā $ (898) ā $ 827 ā Foreign currency gain ā ā 1,808 ā ā 163 ā Other income, net ā ā 27 ā ā 57 ā Total other income ā $ 937 ā $ 1,047 ā ā |
INVESTMENTS
INVESTMENTS | 3 Months Ended |
Mar. 31, 2020 | |
INVESTMENTS | |
INVESTMENTS | ā NOTE 5 INVESTMENTS ā The following is a summary of the activity in investments for the three months ended March 31, 2020 and 2019: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions/ ā ā ā Disposals/ ā Unrealized ā Fair value ā ā December 31, ā transfers during ā Net (loss) on ā transfers during ā (loss) on ā March 31, ā 2019 period securities sold period securities held 2020 Marketable equity securities ā $ 1,885 ā $ ā ā $ (16) ā $ (112) ā $ (882) ā $ 875 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions/ ā Net gain ā Disposals/ ā Unrealized ā Fair value ā ā December 31, ā transfers during ā (loss) on ā transfers during ā gain on ā March 31, ā 2018 period securities sold ā period ā securities held ā 2019 Marketable equity securities ā $ 2,718 ā $ 264 ā $ ā ā $ ā ā $ 605 ā $ 3,587 Warrants ā 413 ā ā ā ā ā ā ā ā ā ā ā 222 ā ā 635 Investments ā $ 3,131 ā $ 264 ā $ ā ā $ ā ā $ 827 ā $ 4,222 ā During the three months ended March 31, 2020, the Company sold marketable equity securities for proceeds of $0.1 million (2019 - $nil The cost of marketable equity securities at March 31, 2020 was $1.2 million (December 31, 2019 ā $1.3 million). |
RECEIVABLES, PREPAIDS AND OTHER
RECEIVABLES, PREPAIDS AND OTHER ASSETS | 3 Months Ended |
Mar. 31, 2020 | |
RECEIVABLES, PREPAIDS AND OTHER ASSETS | |
RECEIVABLES, PREPAIDS AND OTHER ASSETS | NOTE 6 RECEIVABLES, PREPAIDS AND OTHER ASSETS The following is a breakdown of balances in receivables, prepaids and other assets as at and December 31, 2019: ā ā ā ā ā ā ā ā ā March 31, 2020 December 31, 2019 Government sales tax receivable ā $ 1,468 ā $ 2,658 Prepaids and other assets ā ā 3,670 ā ā 2,607 Receivables and other current assets ā $ 5,138 ā $ 5,265 ā Government sales tax receivable includes $0.5 million of Mexican value added tax (āVATā) at March 31, 2020 (December 31, 2019 ā $0.7 million). The Company collected $0.4 million of VAT during the three months ended March 31, 2020 (March 31, 2019 ā $0.1 million). |
INVENTORIES
INVENTORIES | 3 Months Ended |
Mar. 31, 2020 | |
INVENTORIES | |
INVENTORIES | NOTE 7 INVENTORIES Inventories at and December 31, 2019 consisted of the following: ā ā ā ā ā ā ā ā ā March 31, 2020 December 31, 2019 Material on leach pads ā $ 36,627 ā $ 37,328 In-process inventory ā 2,806 ā 3,847 Stockpiles ā 1,620 ā 1,384 Precious metals ā 1,486 ā 1,038 Materials and supplies ā 4,473 ā 4,382 Inventories ā $ 47,012 ā $ 47,979 Less current portion ā ā 38,327 ā ā 38,376 Long-term portion ā $ 8,685 ā $ 9,603 ā During the three months ended March 31, 2020 the inventory of Gold Bar Mine was written down to its net realizable value; of this amount, $1.2 million was included in production costs applicable to sales (March 31, 2019 - $nil). |
MINERAL PROPERTY INTERESTS AND
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | 3 Months Ended |
Mar. 31, 2020 | |
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | |
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | NOTE 8 MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT The definition of proven and probable reserves is set forth in the SEC Industry Guide 7. If proven and probable reserves exist at the Companyās properties, the relevant capitalized mineral property interests and asset retirement costs are charged to expense based on the units of production method upon commencement of production. The Companyās Gold Bar, Black Fox and San JosĆ© properties have proven and probable reserves estimated in accordance with SEC Industry Guide 7. The Company reviews and evaluates its long-lived assets for impairment on a quarterly basis or when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Once it is determined that impairment exists, an impairment loss is measured as the amount by which the asset carrying value exceeds its fair value. ā As part of the analysis, the Company determined during the quarterly period ended March 31, 2020 that indicators of impairment existed for the long-lived assets at the Gold Bar mine and that the long-lived assets at the Gold Bar mine were not recoverable on an undiscounted basis. The fair value of the Gold Bar mine was determined using the discounted cash flow method, coupled with an in-situ resource multiple for mineralized material not included in the life of mine plan. Future cash flows were estimated based on estimated quantities of recoverable mineralized material, expected gold prices, estimated production levels, operating costs, capital requirements and reclamation costs, all based on the life-of-mine plan using the preliminary estimated resources. The in-situ resource multiple applied to the mineralized material not included in the life-of-mine plan was estimated by evaluating observable market transactions. The Company concluded that the carrying value of the long-lived assets at the Gold Bar mine was impaired and recorded a non-cash impairment charge reducing plant and equipment and mineral property interests by the amount of $83.8 million as at March 31, 2020. ā The following table sets forth a summary of the quantitative and qualitative information related to the unobservable inputs used in the calculation of the Companyās non-recurring Level 3 fair value measurement for the three months ended March 31, 2020: ā ā ā ā ā ā ā ā ā ā ā ā As at March 31, 2020 ā ā Date of Fair Value Measurement ā Valuation Technique ā Unobservable Input ā Range/ Weighted Average ā ā ā ā ā ā ā ā ā Gold Bar Mine ā March 31, 2020 ā Discounted Cash Flow ā Discount Rate ā 9% ā ā ā ā ā ā Long Term Gold Price ā $1,430/oz ā ā ā ā ā ā United States Inflation Index ā 2% ā ā The future cash flows are based on numerous assumptions and uncertainties. It is possible that actual future cash flows will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold prices, production levels and costs of capital are each subject to significant risks and uncertainties. ā |
INVESTMENT IN MINERA SANTA CRUZ
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | 3 Months Ended |
Mar. 31, 2020 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | NOTE 9 INVESTMENT IN MINERA SANTA CRUZ S.A. (āMSCā) ā SAN JOSĆ MINE The Company accounts for investments over which it exerts significant influence but does not control through majority ownership using the equity method of accounting. In applying the equity method of accounting to the Companyās investment in MSC, MSCās financial statements, which are originally prepared by MSC in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, have been adjusted to conform with U.S. GAAP. As such, the summarized financial data presented under this heading is in accordance with U.S. GAAP. A summary of the operating results from MSC for the three months ended March 31, 2020 and 2019 is as follows: ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, ā ā 2020 ā 2019 ā Minera Santa Cruz S.A. (100%) ā ā ā ā ā ā ā Revenue from gold and silver sales ā $ 37,390 ā $ 47,885 ā Production costs applicable to sales ā ā (28,316) ā ā (29,533) ā Depreciation and depletion ā ā (7,327) ā ā (15,380) ā Gross profit ā ā 1,747 ā ā 2,972 ā Exploration ā ā (2,866) ā ā (3,338) ā Other expenses ā ā (2,217) ā ā (1,617) ā Net (loss) before tax ā $ (3,336) ā $ (1,983) ā Current and deferred tax expense ā ā 49 ā ā (789) ā Net loss ā $ (3,287) ā $ (2,772) ā ā ā ā ā ā ā ā ā Portion attributable to McEwen Mining Inc. (49%) ā ā ā ā ā ā ā Net loss ā $ (1,611) ā $ (1,358) ā Amortization of fair value increments ā (1,385) ā (1,913) ā Income tax recovery ā ā 320 ā ā 961 ā Loss from investment in MSC, net of amortization ā $ (2,676) ā $ (2,310) ā ā The loss from investment in MSC attributable to the Company includes the amortization of the fair value increments arising from the initial purchase price allocation and related income tax recovery. The income tax recovery reflects the impact of devaluation of the Argentine peso against the U.S. dollar on the peso-denominated deferred tax liability recognized at the time of acquisition. Changes in the Companyās investment in MSC for the three months ended March 31, 2020 and year ended December 31, 2019 are as follows: ā ā ā ā ā ā ā ā ā March 31, 2020 December 31, 2019 Investment in MSC, beginning of period ā $ 110,183 ā $ 127,814 Attributable net loss from MSC ā ā (1,611) ā ā (2,097) Amortization of fair value increments ā (1,385) ā (9,448) Income tax recovery ā ā 320 ā ā 2,791 Dividend distribution received ā ā ā (8,877) Investment in MSC, end of period ā $ 107,507 ā $ 110,183 ā During the three months ended March 31, 2020, the Company received $nil A summary of the key assets and liabilities of MSC as at March 31, 2020, before and after adjustments to fair value on acquisition and amortization of the fair value increments arising from the purchase price allocation, are as follows: ā ā ā ā ā ā ā ā ā ā ā As at March 31, 2020 ā Balance excluding FV increments ā Adjustments ā Balance including FV increments Current assets ā $ 86,238 ā $ 1,102 ā $ 87,340 Total assets ā $ 185,137 ā $ 116,609 ā $ 301,746 ā ā ā ā ā ā ā ā ā ā Current liabilities ā $ (46,692) ā $ ā ā $ (46,692) Total liabilities ā $ (76,759) ā $ (5,585) ā $ (82,344) ā |
DEBT
DEBT | 3 Months Ended |
Mar. 31, 2020 | |
DEBT | |
DEBT | NOTE 10 DEBT On August 10, 2018, the Company finalized a $50.0 million senior secured three year term loan facility with Royal Capital Management Corp., an administrative agent, and the lenders party thereto (āLendersā). An affiliate of Robert McEwen, Chairman and Chief Executive Officer and the beneficial owner of 20% of the Companyās current outstanding common stock, contributed $25.0 million of the $50.0 million total term loan. The loan bears interest at 9.75% per annum with interest due monthly and is secured by a lien on certain of the Companyās and its subsidiariesā assets. Scheduled payments on the loan are as follows: $2.0 million monthly payments starting in August 2020 for 12 months and a final $26.0 million payment on August 10, 2021. A reconciliation of the Companyās long-term debt for the three months ended March 31, 2020 and for the year ended December 31, 2019 is as follows: ā ā ā ā ā ā ā ā ā ā Three months ending March 31, 2020 Year ending December 31, 2019 ā Balance, beginning of period ā 49,516 ā 49,206 ā Interest expense ā 1,297 ā 5,185 ā Interest payments ā (1,215) ā (4,875) ā Balance, end of period ā $ 49,598 ā $ 49,516 ā Less current portion ā ā 16,000 ā ā 10,000 ā Long-term portion ā $ 33,598 ā $ 39,516 ā ā During the three months ended March 31, 2020; $nil (March 31, 2019 ā $0.6 million) of interest was capitalized in plant and equipment as construction costs for the Gold Bar mine. The scheduled remaining minimum interest payments are $3.5 million in 2020 and $2.0 million in 2021. |
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 3 Months Ended |
Mar. 31, 2020 | |
ASSET RETIREMENT OBLIGATIONS | |
ASSET RETIREMENT OBLIGATIONS | NOTE 11 ASSET RETIREMENT OBLIGATIONS The Company is responsible for reclamation of certain past and future disturbances at its properties. The most significant properties subject to these obligations are the Gold Bar and Tonkin properties in Nevada, the Timmins properties in Canada and the El Gallo Project in Mexico. A reconciliation of the Companyās asset retirement obligations for the three months ended March 31, 2020 and for the year ended December 31, 2019 are as follows: ā ā ā ā ā ā ā ā ā March 31, 2020 December 31, 2019 Asset retirement obligation liability, beginning balance ā $ 32,201 ā $ 29,402 Settlements ā (90) ā (513) Accretion of liability ā 457 ā 1,680 Adjustment reflecting updated estimates ā 262 ā 1,012 Foreign exchange revaluation ā ā (927) ā ā 620 Asset retirement obligation liability, ending balance ā $ 31,903 ā $ 32,201 Less current portion ā ā 1,905 ā ā 2,610 Long-term portion ā $ 29,998 ā $ 29,591 ā The Companyās reclamation expenses consisted of the following: ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, ā ā 2020 2019 ā Reclamation adjustment reflecting updated estimates ā $ 203 ā $ 64 ā Reclamation accretion ā ā 457 ā ā 397 ā Total ā $ 660 ā $ 461 ā ā |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 3 Months Ended |
Mar. 31, 2020 | |
SHAREHOLDERS' EQUITY | |
SHAREHOLDERS' EQUITY | NOTE 12 SHAREHOLDERSā EQUITY Equity Issuances March 2019 Registered Offering On March 29, 2019, the Company issued 14,193,548 Units at $1.55 per Unit, for net proceeds of $20.3 million (net of issuance costs of $1.7 million). Each Unit consisted of one common share and one On March 29, 2019, the Company also issued 1,935,484 Subscription Receipts at $1.55 per Subscription Receipt to certain of our executive officers, directors, employees and consultants. Upon shareholder and NYSE approval on May 23, 2019, the Subscription Receipts were converted into 1,935,484 Units for net proceeds of $2.6 million (net of issuance costs of $0.4 million). All Units issued under the offering have consistent terms. At-the-market (āATMā) Offering Pursuant to an equity distribution agreement dated November 8, 2018, the Company was permitted to offer and sell from time to time shares of its common stock having an aggregate offering price of up to $90.0 million, with the net proceeds to fund working capital and general corporate purposes. During the three months ended March 31, 2019, the Company issued an aggregate of 1,010,545 common shares for gross and net proceeds of $1.9 million. The Company terminated the agreement on March 13, 2019. Stock Options During the three months ended March 31, 2020, the Company issued 60,000 common shares for proceeds of $0.1 million upon the exercise of the same number of stock options at a weighted average exercise price of $1.06 per share. During the same period in 2019, the Company issued 221,500 common shares for proceeds of $0.2 million upon the exercise of the same number of stock options at a weighted average exercise price of $1.00 per share. Shareholdersā Distributions No distributions were paid during the three months ended March 31, 2020 or 2019. Pursuant to the term loan facility dated August 10, 2018 ( Note 10 |
NET LOSS PER SHARE
NET LOSS PER SHARE | 3 Months Ended |
Mar. 31, 2020 | |
NET LOSS PER SHARE | |
NET LOSS PER SHARE | NOTE 13 NET LOSS PER SHARE Basic net loss per share is computed by dividing the net loss attributable to common shareholders by the weighted average number of common shares outstanding during the period. Potentially dilutive instruments are not included in the calculation of diluted net loss per share for the three months ended March 31, 2020 and 2019, as they would be anti-dilutive. For the three months ended March 31, 2020, all of the outstanding options (4,430,784) and all of the outstanding warrants (29,770,766) were excluded from the computation of diluted loss per share (March 31, 2019 ā 3,838,317 outstanding options and 7,096,744 outstanding warrants). ā |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Mar. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 14 RELATED PARTY TRANSACTIONS The Company recorded the following expense in respect to the related parties outlined below during the periods presented: ā ā ā ā ā ā ā Three months ended March 31, ā 2020 2019 Lexam L.P. $ 76 ā $ 61 REVlaw ā 38 ā ā 41 The Company has the following outstanding accounts payable balances in respect to the related parties outlined below: ā ā ā ā ā ā ā March 31, 2020 ā December 31, 2019 Lexam L.P. $ 76 ā $ 65 REVlaw $ 20 ā $ 12 ā An aircraft owned by Lexam L.P. which is controlled by Robert R. McEwen, limited partner and beneficiary of Lexam L.P. and the Companyās Chairman and Chief Executive Officer, has been made available to the Company in order to expedite business travel. In his role as Chairman and Chief Executive Officer of the Company, Mr. McEwen must travel extensively and frequently on short notice. Mr. McEwen is able to charter the aircraft from Lexam L.P. at a preferential rate approved by the Companyās independent board members under a policy whereby only the variable expenses of operating this aircraft for business related travel are eligible for reimbursement by the Company. REVlaw is a company owned by Ms. Carmen Diges, General Counsel of the Company. The legal services of Ms. Diges as General Counsel and other support staff, as needed, are provided by REVlaw in the normal course of business and have been recorded at their exchange amount. An affiliate of Mr. McEwen participated as a lender in the $50.0 million term loan by providing $25.0 million of the total $50.0 million funding. During the three months ended March 31, 2020, the Company paid $0.6 million (three months ended March 31, 2019 ā $0.6 million) in interest to this affiliate . Note 10 |
FAIR VALUE ACCOUNTING
FAIR VALUE ACCOUNTING | 3 Months Ended |
Mar. 31, 2020 | |
FAIR VALUE ACCOUNTING | |
FAIR VALUE ACCOUNTING | NOTE 15 FAIR VALUE ACCOUNTING 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. Assets and liabilities measured at fair value on a recurring basis. The following table identifies the Companyās assets and liabilities measured at fair value on a recurring basis (at least annually) by level within the fair value hierarchy as at March 31, 2020 and December 31, 2019, as reported in the Consolidated Balance Sheets ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair value as at March 31, 2020 Fair value as at December 31, 2019 ā Level 1 Level 2 Total Level 1 Level 2 Total Marketable equity securities ā $ 875 ā $ ā ā $ 875 ā $ 1,885 ā $ ā ā $ 1,885 ā The Companyās investments consist of marketable equity securities which are exchange-traded and are valued using quoted market prices in active markets and as such 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 quantity of shares held by the Company. During the three months ended March 31, 2020, the Company recorded an impairment of long-lived assets at the Gold Bar Mine totaling $83.8 million based on Level 3 inputs. See Note 8 Debt is recorded at amortized cost of $49.6 million (December 31, 2019 ā $49.5 million). The debt is not traded on quoted markets. Based on Level 3 inputs, the fair market value of the debt approximates its carrying value due to its short maturity of 17 months. The fair value of other financial assets and liabilities were assumed to 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, 2020 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 16 COMMITMENTS AND CONTINGENCIES In addition to the commitments for payments on operating and finance leases and the repayment of long-term debt (Note 10), as at March 31, 2020, the Company has the following commitments and contingencies: Reclamation Obligations As part of its ongoing business and operations, the Company is required to provide bonding for its environmental reclamation obligations of $20.1 million (Nevada, United States) pertaining primarily to the Tonkin and the Gold Bar properties and $10.5 million (C$14.9 million) in Canada with respect to the Black Fox Complex. In addition, under Canadian regulations, the Company was required to deposit approximately $0.1 million with respect to its Lexam properties in Timmins, which is recorded as restricted cash in other assets ( Note 17) Surety Bonds As at March 31, 2020, the Company has a surety facility in place to cover all its bonding obligations, which include $20.1 million of bonding in Nevada and $10.5 million (C$14.9 million) of bonding in Canada. The terms of the facility carry an annual financing fee of 2% and no deposit requirements. The surety bonds are available for draw down by the beneficiary in the event the Company does not perform its reclamation obligations. If the specific reclamation requirements are met, the beneficiary of the surety bonds will release 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. Streaming Agreement As part of the acquisition of the Black Fox Complex in 2017, the Company assumed a gold purchase agreement (streaming contract) related to production from certain land claims. The Company is obligated to sell 8% of gold production from the Black Fox mine and 6.3% from the adjoining Pike River property (Black Fox extension) to Sandstorm Gold Ltd. at the lesser of market price or $561 per ounce (with inflation adjustments of up to 2% per year) until 2090. The Company records the revenue from these shipments based on the contract price at the time of delivery to the customer. During the three months ended March 31, 2020, the Company recorded revenue of $0.5 million (March 31, 2019 ā $0.4 million) related to the gold stream sales. |
CASH AND CASH EQUIVALENTS AND R
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | 3 Months Ended |
Mar. 31, 2020 | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | NOTE 17 CASH, CASH EQUIVALENTS AND RESTRICTED CASH The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported in the Consolidated Balance Sheets Consolidated Statements of Cash flows ā ā ā ā ā ā ā ā ā ā March 31, 2020 ā December 31, 2019 Cash and cash equivalents ā $ 28,774 ā $ 46,452 Restricted cash included in other assets ā ā 48 ā ā 48 Total cash, cash equivalents, and restricted cash ā $ 28,822 ā $ 46,500 ā |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. | |
Risks and Uncertainties | Risks and Uncertainties COVID-19 On March 11, the World Health Organization (āWHOā) declared the COVID-19 virus a global pandemic. As a result of the pandemic, many jurisdictions, including the United States (āUSā), some of its political subdivisions, Canada, Mexico and Argentina, instituted restrictions on travel, public gatherings and certain business operations. This lead to significant adverse effects on the Companyās operations. During late March and early April, all the Companyās operations were disrupted by temporary shutdowns to protect its workforce from the spread of the virus. During the shutdowns, rigorous policies and procedures were implemented at each site to minimize potential health and safety risks to the workforce. ā The temporary shutdowns will adversely impact the Companyās operations, cash flow, and liquidity in the second quarter of 2020. However, the full impact of the COVID normal capacity can be sustained and whether ongoing operating costs will be adversely affected. Depending on the length and severity of the outbreak, the Companyās liquidity and financial condition may be adversely affected and the Company may be at an increased risk of default under its debt agreements. Achieving normal operating capacity is also dependant on the continued availability of supplies, which is out of the Companyās control. Management is actively monitoring the global situation on its financial condition, liquidity, operations, suppliers, industry and workforce . As of May 18, 2020, the date on which these financial statements were authorized for issuance, the global situation remains uncertain. The governments of the US, Canada, Mexico and Argentina have enacted or proposed legislation to provide relief to companies and/or individuals affected by the enforced reduction in operations. The Company is in the process of applying for available relief. It is highly uncertain if the Company would qualify for funding under these relief programs, and if the Company does qualify, how much funding would be available. Going Concern In the preparation of the interim financial statements, management is required to identify when events or conditions indicate that substantial doubt may exist about the Companyās ability to continue as a going concern. Substantial doubt about the Companyās ability to continue as a going concern would exist when relevant conditions and events, considered in aggregate, indicate that the Company may not be able to meet its obligations as they become due for a period of at least, but not limited to, 12 months from the balance sheet date. When the Company identifies conditions or events that raise potential for substantial doubt about its ability to continue as a going concern, the Company considers whether its plans that are intended to mitigate those relevant conditions or events will alleviate the potential substantial doubt. ā The Company is in full compliance with financial covenants under its outstanding credit agreement as at March 31, 2020. However, as a result of the expected significant resource reduction at the Gold Bar mine, resulting in an initial revised mine plan which yields less cash flow coupled with the disruptions to operations caused by the COVID-19 pandemic, there is uncertainty about the Companyās ability to remain in compliance with certain of these financial covenants over the next twelve months. Non-compliance with these covenants would result in a breach under the Companyās debt agreement and the lenderās right to accelerate the balance due under the agreement. In response to this uncertainty, the Company is in discussions with its lenders to seek relief from certain of these financial covenants and evaluating options to re-finance the debt, raise additional equity, and curtail discretionary expenditures. The Companyās ability to continue as a going concern is dependent on the successful completion of one or more of these initiatives to ensure that it has sufficient liquidity available to satisfy these financial covenants and in order to fund its operations. After considering these plans, management has concluded that it has mitigated the risk of material uncertainties relating to events or conditions that may cast substantial doubt upon the Companyās ability to continue as a going concern for a period of 12 months from the consolidated balance sheet date. The estimates used by management in reaching this conclusion are based on information available as at the date these financial statements were authorized for issuance, and include internally generated cash flow forecasts. Accordingly, actual results could differ from these estimates and resulting variances may be material to managementās assessment. |
Recently Adopted And Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements Changes to the Disclosure Requirements for Fair Value Measurement: Recently Issued Accounting Pronouncements Income Taxes: is effective for the Company for the fiscal years beginning after December 15, 2020, with early adoption permitted. The Company is currently evaluating the effect of this amendment and the impact it may have on the Companyās consolidated financial statements. |
Reclassifications | Reclassifications Certain amounts in the comparative Statement of Operations Advanced projects Statement of Operations Exploration Statement of Operations General and Administrative Statement of Operations |
OPERATING SEGMENT REPORTING (Ta
OPERATING SEGMENT REPORTING (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
OPERATING SEGMENT REPORTING | |
Schedule of the financial information relating to the Company's segments | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, 2020 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ 14,317 ā $ 12,739 ā $ 4,344 ā $ ā ā $ ā ā $ 31,400 Production costs applicable to sales ā ā (17,032) ā ā (7,207) ā ā (4,148) ā ā ā ā ā ā ā (28,387) Depreciation and depletion ā ā (3,862) ā ā (2,748) ā ā (88) ā ā ā ā ā ā ā ā (6,698) Gross (loss) profit ā ā (6,577) ā ā 2,784 ā ā 108 ā ā ā ā ā ā ā ā (3,685) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (366) ā ā (1,066) ā ā (1,118) ā ā ā ā ā ā ā (2,550) Exploration ā ā (809) ā ā (2,405) ā ā ā ā ā ā ā ā (576) ā ā (3,790) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (2,676) ā ā ā ā (2,676) Impairment of mineral property interests and plant and equipment (note 8) ā ā (83,805) ā ā ā ā ā ā ā ā ā ā ā ā ā ā (83,805) Segment loss ā $ (91,557) ā $ (687) ā $ (1,010) ā $ (2,676) ā $ (576) ā $ (96,506) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (3,779) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (100,285) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 1,807 ā ā 3,729 ā ā ā ā ā ā ā ā ā ā $ 5,536 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, 2019 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ 842 ā $ 8,943 ā $ 5,798 ā $ ā ā $ ā ā $ 15,583 Production costs applicable to sales ā ā (808) ā ā (5,835) ā ā (4,505) ā ā ā ā ā ā ā ā (11,148) Depreciation and depletion ā ā (152) ā ā (2,710) ā ā (144) ā ā ā ā ā ā ā ā (3,006) Gross (loss) profit ā ā (118) ā ā 398 ā ā 1,149 ā ā ā ā ā ā ā ā 1,429 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (195) ā ā ā ā ā (2,452) ā ā ā ā ā ā ā ā (2,647) Exploration ā ā (613) ā ā (2,420) ā ā ā ā ā ā ā ā (1,117) ā ā (4,150) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (2,310) ā ā ā ā ā (2,310) Segment (loss) ā $ (926) ā $ (2,022) ā $ (1,303) ā $ (2,310) ā $ (1,117) ā $ (7,678) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (2,340) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (10,018) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Capital expenditures ā $ 13,008 ā $ 3,343 ā $ ā ā $ ā ā $ ā ā $ 16,351 ā |
Schedule Of Geographic Information | Geographic information Geographic information includes the long-lived assets balance and revenues presented for the Companyās operating segments, as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Long-lived Assets ā Revenue (1) ā ā ā March 31, ā December 31, ā Three months ended March 31, ā ā 2020 2019 2020 ā 2019 ā USA ā $ 50,599 ā $ 135,854 ā $ 14,317 ā $ 842 ā Canada ā ā 78,505 ā ā 77,147 ā ā 12,739 ā ā 8,943 ā Mexico ā ā 21,457 ā ā 23,551 ā ā 4,344 ā ā 5,798 ā Argentina (2) ā ā 298,997 ā ā 302,598 ā ā ā ā ā ā ā Total consolidated (3) ā $ 449,558 ā $ 539,150 ā $ 31,400 ā $ 15,583 ā (1) Presented based on the location from which the product originated. (2) Includes Investment in MSC of $107.5 million as of March 31, 2020 (December 31, 2019 ā $110.2 million). (3) Total excludes $0.9 million related to the Company's office lease asset as the business activities related to corporate are not considered to be a part of the operating segments . |
OTHER INCOME (Tables)
OTHER INCOME (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
OTHER INCOME | |
Schedule of other income (expense) | ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, ā ā 2020 2019 ā Unrealized and realized (loss) gain on investments (note 5) ā $ (898) ā $ 827 ā Foreign currency gain ā ā 1,808 ā ā 163 ā Other income, net ā ā 27 ā ā 57 ā Total other income ā $ 937 ā $ 1,047 ā |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
INVESTMENTS | |
Summary of investment portfolio | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions/ ā ā ā Disposals/ ā Unrealized ā Fair value ā ā December 31, ā transfers during ā Net (loss) on ā transfers during ā (loss) on ā March 31, ā 2019 period securities sold period securities held 2020 Marketable equity securities ā $ 1,885 ā $ ā ā $ (16) ā $ (112) ā $ (882) ā $ 875 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions/ ā Net gain ā Disposals/ ā Unrealized ā Fair value ā ā December 31, ā transfers during ā (loss) on ā transfers during ā gain on ā March 31, ā 2018 period securities sold ā period ā securities held ā 2019 Marketable equity securities ā $ 2,718 ā $ 264 ā $ ā ā $ ā ā $ 605 ā $ 3,587 Warrants ā 413 ā ā ā ā ā ā ā ā ā ā ā 222 ā ā 635 Investments ā $ 3,131 ā $ 264 ā $ ā ā $ ā ā $ 827 ā $ 4,222 |
RECEIVABLES, PREPAIDS AND OTH_2
RECEIVABLES, PREPAIDS AND OTHER ASSETS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
RECEIVABLES, PREPAIDS AND OTHER ASSETS | |
Schedule of balances in receivables and other current assets | ā ā ā ā ā ā ā ā ā March 31, 2020 December 31, 2019 Government sales tax receivable ā $ 1,468 ā $ 2,658 Prepaids and other assets ā ā 3,670 ā ā 2,607 Receivables and other current assets ā $ 5,138 ā $ 5,265 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
INVENTORIES | |
Schedule of inventories | ā ā ā ā ā ā ā ā ā March 31, 2020 December 31, 2019 Material on leach pads ā $ 36,627 ā $ 37,328 In-process inventory ā 2,806 ā 3,847 Stockpiles ā 1,620 ā 1,384 Precious metals ā 1,486 ā 1,038 Materials and supplies ā 4,473 ā 4,382 Inventories ā $ 47,012 ā $ 47,979 Less current portion ā ā 38,327 ā ā 38,376 Long-term portion ā $ 8,685 ā $ 9,603 |
MINERAL PROPERTY INTERESTS AN_2
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | |
Summary of the quantitative and qualitative information related to the unobservable inputs used in the calculation of the Company's non-recurring Level 3 fair value measurements | ā ā ā ā ā ā ā ā ā ā ā ā As at March 31, 2020 ā ā Date of Fair Value Measurement ā Valuation Technique ā Unobservable Input ā Range/ Weighted Average ā ā ā ā ā ā ā ā ā Gold Bar Mine ā March 31, 2020 ā Discounted Cash Flow ā Discount Rate ā 9% ā ā ā ā ā ā Long Term Gold Price ā $1,430/oz ā ā ā ā ā ā United States Inflation Index ā 2% |
INVESTMENT IN MINERA SANTA CR_2
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |
Summary of MSC's financial information from operations | ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, ā ā 2020 ā 2019 ā Minera Santa Cruz S.A. (100%) ā ā ā ā ā ā ā Revenue from gold and silver sales ā $ 37,390 ā $ 47,885 ā Production costs applicable to sales ā ā (28,316) ā ā (29,533) ā Depreciation and depletion ā ā (7,327) ā ā (15,380) ā Gross profit ā ā 1,747 ā ā 2,972 ā Exploration ā ā (2,866) ā ā (3,338) ā Other expenses ā ā (2,217) ā ā (1,617) ā Net (loss) before tax ā $ (3,336) ā $ (1,983) ā Current and deferred tax expense ā ā 49 ā ā (789) ā Net loss ā $ (3,287) ā $ (2,772) ā ā ā ā ā ā ā ā ā Portion attributable to McEwen Mining Inc. (49%) ā ā ā ā ā ā ā Net loss ā $ (1,611) ā $ (1,358) ā Amortization of fair value increments ā (1,385) ā (1,913) ā Income tax recovery ā ā 320 ā ā 961 ā Loss from investment in MSC, net of amortization ā $ (2,676) ā $ (2,310) ā |
Schedule of change in the entity's investment in MSC | ā ā ā ā ā ā ā ā ā March 31, 2020 December 31, 2019 Investment in MSC, beginning of period ā $ 110,183 ā $ 127,814 Attributable net loss from MSC ā ā (1,611) ā ā (2,097) Amortization of fair value increments ā (1,385) ā (9,448) Income tax recovery ā ā 320 ā ā 2,791 Dividend distribution received ā ā ā (8,877) Investment in MSC, end of period ā $ 107,507 ā $ 110,183 |
Summary of key assets and liabilities, before and after adjustments to fair value | ā ā ā ā ā ā ā ā ā ā ā As at March 31, 2020 ā Balance excluding FV increments ā Adjustments ā Balance including FV increments Current assets ā $ 86,238 ā $ 1,102 ā $ 87,340 Total assets ā $ 185,137 ā $ 116,609 ā $ 301,746 ā ā ā ā ā ā ā ā ā ā Current liabilities ā $ (46,692) ā $ ā ā $ (46,692) Total liabilities ā $ (76,759) ā $ (5,585) ā $ (82,344) |
DEBT (Tables)
DEBT (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
DEBT | |
Schedule of Movements In Debt | ā ā ā ā ā ā ā ā ā ā Three months ending March 31, 2020 Year ending December 31, 2019 ā Balance, beginning of period ā 49,516 ā 49,206 ā Interest expense ā 1,297 ā 5,185 ā Interest payments ā (1,215) ā (4,875) ā Balance, end of period ā $ 49,598 ā $ 49,516 ā Less current portion ā ā 16,000 ā ā 10,000 ā Long-term portion ā $ 33,598 ā $ 39,516 ā |
ASSET RETIREMENT OBLIGATIONS (T
ASSET RETIREMENT OBLIGATIONS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
ASSET RETIREMENT OBLIGATIONS | |
Schedule of reconciliation of asset retirement obligations | ā ā ā ā ā ā ā ā ā March 31, 2020 December 31, 2019 Asset retirement obligation liability, beginning balance ā $ 32,201 ā $ 29,402 Settlements ā (90) ā (513) Accretion of liability ā 457 ā 1,680 Adjustment reflecting updated estimates ā 262 ā 1,012 Foreign exchange revaluation ā ā (927) ā ā 620 Asset retirement obligation liability, ending balance ā $ 31,903 ā $ 32,201 Less current portion ā ā 1,905 ā ā 2,610 Long-term portion ā $ 29,998 ā $ 29,591 |
Schedule of reclamation expense | The Companyās reclamation expenses consisted of the following: ā ā ā ā ā ā ā ā ā ā ā Three months ended March 31, ā ā 2020 2019 ā Reclamation adjustment reflecting updated estimates ā $ 203 ā $ 64 ā Reclamation accretion ā ā 457 ā ā 397 ā Total ā $ 660 ā $ 461 ā |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
RELATED PARTY TRANSACTIONS | |
Schedule of related party expense and outstanding accounts payable | The Company recorded the following expense in respect to the related parties outlined below during the periods presented: ā ā ā ā ā ā ā Three months ended March 31, ā 2020 2019 Lexam L.P. $ 76 ā $ 61 REVlaw ā 38 ā ā 41 The Company has the following outstanding accounts payable balances in respect to the related parties outlined below: ā ā ā ā ā ā ā March 31, 2020 ā December 31, 2019 Lexam L.P. $ 76 ā $ 65 REVlaw $ 20 ā $ 12 |
FAIR VALUE ACCOUNTING (Tables)
FAIR VALUE ACCOUNTING (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
FAIR VALUE ACCOUNTING | |
Schedule of assets and liabilities measured at fair value on a recurring basis by level within the fair value hierarchy | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair value as at March 31, 2020 Fair value as at December 31, 2019 ā Level 1 Level 2 Total Level 1 Level 2 Total Marketable equity securities ā $ 875 ā $ ā ā $ 875 ā $ 1,885 ā $ ā ā $ 1,885 |
CASH AND CASH EQUIVALENTS AND_2
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | |
Reconciliation of cash and cash equivalents and restricted cash | ā ā ā ā ā ā ā ā ā ā March 31, 2020 ā December 31, 2019 Cash and cash equivalents ā $ 28,774 ā $ 46,452 Restricted cash included in other assets ā ā 48 ā ā 48 Total cash, cash equivalents, and restricted cash ā $ 28,822 ā $ 46,500 |
NATURE OF OPERATIONS AND RECENT
NATURE OF OPERATIONS AND RECENT ACCOUNTING PRONOUNCEMENTS (Details) | 3 Months Ended |
Mar. 31, 2020 | |
Ownership interest (as a percent) | 49.00% |
Subsidiary (as a percent) | 100.00% |
MSC | |
Ownership interest (as a percent) | 49.00% |
OPERATING SEGMENT REPORTING (De
OPERATING SEGMENT REPORTING (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Operating Segment Reporting | |||
Inventory | $ 38,327 | $ 38,376 | |
Revenue from gold and silver sales | 31,400 | $ 15,583 | |
Production costs applicable to sales | (28,387) | (11,148) | |
Depreciation and depletion | (6,698) | (3,006) | |
Gross profit | (3,685) | 1,429 | |
Advanced projects | (2,550) | (2,647) | |
Loss from investment in Minera Santa Cruz S.A. (note 8) | (2,676) | (2,310) | |
Impairment of mineral property interests and plant and equipment (note 8) | (83,805) | ||
Segment (loss) income | (96,506) | (7,678) | |
General and Administrative and other | (3,779) | (2,340) | |
Loss before income and mining taxes | (100,285) | (10,018) | |
Capital expenditures | 5,536 | 16,351 | |
El Gallo Project | |||
Operating Segment Reporting | |||
Inventory | 1,100 | 1,800 | |
Production costs applicable to sales | (4,200) | (4,500) | |
Sunk costs | 1,700 | ||
U.S. | |||
Operating Segment Reporting | |||
Depreciation and depletion | (3,862) | (152) | |
Gross profit | (6,577) | (118) | |
Advanced projects | (366) | (195) | |
Impairment of mineral property interests and plant and equipment (note 8) | (83,805) | ||
Segment (loss) income | (91,557) | (926) | |
Capital expenditures | 1,807 | 13,008 | |
Canada | |||
Operating Segment Reporting | |||
Depreciation and depletion | (2,748) | (2,710) | |
Gross profit | 2,784 | 398 | |
Advanced projects | (1,066) | ||
Segment (loss) income | (687) | (2,022) | |
Capital expenditures | 3,729 | 3,343 | |
Mexico | |||
Operating Segment Reporting | |||
Depreciation and depletion | (88) | (144) | |
Gross profit | 108 | 1,149 | |
Advanced projects | (1,118) | (2,452) | |
Segment (loss) income | (1,010) | (1,303) | |
MSC | |||
Operating Segment Reporting | |||
Loss from investment in Minera Santa Cruz S.A. (note 8) | (2,676) | (2,310) | |
Segment (loss) income | (2,676) | (2,310) | |
Los Azules | |||
Operating Segment Reporting | |||
Segment (loss) income | (576) | (1,117) | |
MSC | |||
Operating Segment Reporting | |||
Revenue from gold and silver sales | 37,390 | 47,885 | |
Production costs applicable to sales | (28,316) | (29,533) | |
Depreciation and depletion | (7,327) | (15,380) | |
Gross profit | 1,747 | 2,972 | |
Loss from investment in Minera Santa Cruz S.A. (note 8) | (2,676) | (2,310) | |
Loss before income and mining taxes | (3,336) | (1,983) | |
Gold and silver sales | |||
Operating Segment Reporting | |||
Revenue from gold and silver sales | 31,400 | 15,583 | |
Gold and silver sales | U.S. | |||
Operating Segment Reporting | |||
Revenue from gold and silver sales | 14,317 | 842 | |
Gold and silver sales | Canada | |||
Operating Segment Reporting | |||
Revenue from gold and silver sales | 12,739 | 8,943 | |
Gold and silver sales | Mexico | |||
Operating Segment Reporting | |||
Revenue from gold and silver sales | 4,344 | 5,798 | |
Production costs applicable to sales | |||
Operating Segment Reporting | |||
Production costs applicable to sales | (28,387) | ||
Production costs applicable to sales | (11,148) | ||
Production costs applicable to sales | U.S. | |||
Operating Segment Reporting | |||
Production costs applicable to sales | (17,032) | ||
Production costs applicable to sales | (808) | ||
Production costs applicable to sales | Canada | |||
Operating Segment Reporting | |||
Production costs applicable to sales | (7,207) | ||
Production costs applicable to sales | (5,835) | ||
Production costs applicable to sales | Mexico | |||
Operating Segment Reporting | |||
Production costs applicable to sales | (4,148) | ||
Production costs applicable to sales | (4,505) | ||
Exploration | |||
Operating Segment Reporting | |||
Production costs applicable to sales | (3,790) | (4,150) | |
Exploration | U.S. | |||
Operating Segment Reporting | |||
Production costs applicable to sales | (809) | (613) | |
Exploration | Canada | |||
Operating Segment Reporting | |||
Production costs applicable to sales | (2,405) | (2,420) | |
Exploration | Los Azules | |||
Operating Segment Reporting | |||
Production costs applicable to sales | $ (576) | $ (1,117) |
OPERATING SEGMENT REPORTING - G
OPERATING SEGMENT REPORTING - Geographic information (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating Segment Reporting | ||||
Revenue from gold and silver sales | $ 31,400 | $ 15,583 | ||
Long-lived Assets | 449,558 | $ 539,150 | ||
Investment in MSC | 107,507 | 110,183 | ||
Lease assets | 900 | |||
MSC | ||||
Operating Segment Reporting | ||||
Revenue from gold and silver sales | 37,390 | 47,885 | ||
Investment in MSC | 107,507 | 110,183 | $ 127,814 | |
United States | ||||
Operating Segment Reporting | ||||
Revenue from gold and silver sales | 14,317 | 842 | ||
Long-lived Assets | 50,599 | 135,854 | ||
Canada | ||||
Operating Segment Reporting | ||||
Revenue from gold and silver sales | 12,739 | 8,943 | ||
Long-lived Assets | 78,505 | 77,147 | ||
Mexico | ||||
Operating Segment Reporting | ||||
Revenue from gold and silver sales | 4,344 | $ 5,798 | ||
Long-lived Assets | 21,457 | 23,551 | ||
Argentina | ||||
Operating Segment Reporting | ||||
Long-lived Assets | 298,997 | 302,598 | ||
Argentina | MSC | ||||
Operating Segment Reporting | ||||
Investment in MSC | $ 107,500 | $ 110,200 |
OTHER INCOME (Details)
OTHER INCOME (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
OTHER INCOME | ||
Unrealized and realized (loss) gain on investments (note 5) | $ (898) | $ 827 |
Foreign currency gain | 1,808 | 163 |
Other income, net | 27 | 57 |
Total other income | $ 937 | $ 1,047 |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Investments rollforward | |||
Opening balance | $ 1,885 | $ 3,131 | $ 3,131 |
Additions/transfers during the period | 264 | ||
Unrealized (loss) on securities held | 827 | ||
Fair Value end of the period | 875 | 4,222 | 1,885 |
Proceeds from sale of investments | 112 | ||
Cost of purchase of marketable equity securities | 1,200 | 1,300 | |
Marketable equity securities | |||
Investments rollforward | |||
Opening balance | 1,885 | 2,718 | 2,718 |
Additions/transfers during the period | 264 | ||
Net (loss) on securities sold | (16) | ||
Disposals/transfers during period | (112) | ||
Unrealized (loss) on securities held | (882) | 605 | |
Fair Value end of the period | 875 | 3,587 | 1,885 |
Proceeds from sale of investments | $ 100 | 0 | |
Warrants | |||
Investments rollforward | |||
Opening balance | 413 | $ 413 | |
Unrealized (loss) on securities held | 222 | ||
Fair Value end of the period | $ 635 |
RECEIVABLES, PREPAIDS AND OTH_3
RECEIVABLES, PREPAIDS AND OTHER ASSETS (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Receivables, prepaids and other assets | |||
Government sales tax receivable | $ 1,468 | $ 2,658 | |
Other current assets | 3,670 | 2,607 | |
Receivables and other current assets | 5,138 | 5,265 | |
VAT collected | 400 | $ 100 | |
Mexican Tax Authority | |||
Receivables, prepaids and other assets | |||
Government sales tax receivable | $ 500 | $ 700 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
INVENTORIES | |||
Material on leach pads | $ 36,627 | $ 37,328 | |
In-process inventory | 2,806 | 3,847 | |
Stockpiles | 1,620 | 1,384 | |
Precious metals | 1,486 | 1,038 | |
Materials and supplies | 4,473 | 4,382 | |
Inventories | 47,012 | 47,979 | |
Less current portion | 38,327 | 38,376 | |
Long-term portion | 8,685 | $ 9,603 | |
Inventory write-down | $ 1,200 |
MINERAL PROPERTY INTERESTS AN_3
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2020USD ($)$ / oz | |
Mineral property interests and plant and equipment | |
Impairment charges | $ | $ 83,805 |
Nonrecurring | Level 3 | Gold Bar mine | Discounted Cash Flow | Weighted Average | |
Mineral property interests and plant and equipment | |
Discount Rate (as a percent) | 9.00% |
Long term gold price (in dollars per ounce) | $ / oz | 1,430 |
Nonrecurring | Level 3 | Gold Bar mine | Discounted Cash Flow | United States | Weighted Average | |
Mineral property interests and plant and equipment | |
Inflation index (as a percent) | 2.00% |
INVESTMENT IN MINERA SANTA CR_3
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Summary of Operating Results from MSC (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||
Revenue from gold and silver sales | $ 31,400 | $ 15,583 | |
Production costs applicable to sales | (28,387) | (11,148) | |
Depreciation and depletion | (6,698) | (3,006) | |
Gross Profit | (3,685) | 1,429 | |
Net income (loss) before tax | (100,285) | (10,018) | |
Net loss | (99,191) | (10,136) | |
Income and mining tax recovery (note 19) | (1,094) | 118 | |
(Loss) from investment in MSC, net of amortization | $ (2,676) | (2,310) | |
Subsidiary (as a percent) | 100.00% | ||
Ownership interest (as a percent) | 49.00% | ||
MSC | |||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||
Revenue from gold and silver sales | $ 37,390 | 47,885 | |
Production costs applicable to sales | (28,316) | (29,533) | |
Depreciation and depletion | (7,327) | (15,380) | |
Gross Profit | 1,747 | 2,972 | |
Exploration | (2,866) | (3,338) | |
Other expenses | (2,217) | (1,617) | |
Net income (loss) before tax | (3,336) | (1,983) | |
Current and deferred tax expense | 49 | (789) | |
Net loss | (3,287) | (2,772) | |
Net income (loss) | (1,611) | (1,358) | $ (2,097) |
Amortization of fair value increments | (1,385) | (1,913) | (9,448) |
Income and mining tax recovery (note 19) | 320 | 961 | $ 2,791 |
(Loss) from investment in MSC, net of amortization | $ (2,676) | $ (2,310) | |
Ownership interest (as a percent) | 49.00% |
INVESTMENT IN MINERA SANTA CR_4
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Changes in Company's Investment in MSC (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Change in the investment in MSC | |||
Investment in MSC, beginning of period | $ 110,183 | ||
Income and mining tax recovery (note 19) | (1,094) | $ 118 | |
Dividend distribution received | (2,020) | ||
Investment in MSC, end of period | 107,507 | $ 110,183 | |
MSC | |||
Change in the investment in MSC | |||
Investment in MSC, beginning of period | 110,183 | 127,814 | 127,814 |
Attributable net loss from MSC | (1,611) | (1,358) | (2,097) |
Amortization of fair value increments | (1,385) | (1,913) | (9,448) |
Income and mining tax recovery (note 19) | 320 | 961 | 2,791 |
Dividend distribution received | (8,877) | ||
Investment in MSC, end of period | $ 107,507 | $ 110,183 | |
Proceeds from Dividends Received | $ 2,000 |
INVESTMENT IN MINERA SANTA CR_5
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Assets and Liabilities Associated with MSC (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | $ 73,114 | $ 91,978 |
Total assets | 523,626 | 631,223 |
Current liabilities | (47,827) | (48,795) |
Total liabilities | (123,188) | $ (131,744) |
Balance excluding FV increments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 86,238 | |
Total assets | 185,137 | |
Current liabilities | (46,692) | |
Total liabilities | (76,759) | |
Adjustments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 1,102 | |
Total assets | 116,609 | |
Total liabilities | (5,585) | |
Balance including FV increments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 87,340 | |
Total assets | 301,746 | |
Current liabilities | (46,692) | |
Total liabilities | $ (82,344) |
DEBT (Details)
DEBT (Details) - USD ($) $ in Thousands | Aug. 10, 2018 | Aug. 31, 2020 | Mar. 31, 2019 | Aug. 10, 2021 | Mar. 31, 2020 | Dec. 31, 2019 |
LONG-TERM DEBT | ||||||
Long-term debt from related party | $ 16,799 | $ 19,758 | ||||
2020 | 3,500 | |||||
2021 | $ 2,000 | |||||
Gold Bar mine | Construction in process | ||||||
LONG-TERM DEBT | ||||||
Interest costs capitalized | $ 600 | |||||
Term Loan | ||||||
LONG-TERM DEBT | ||||||
Face amount | $ 50,000 | |||||
Term Loan | Gold Bar Complex | ||||||
LONG-TERM DEBT | ||||||
Stated interest rate (as a percent) | 9.75% | |||||
Principal repayments | $ 2,000 | |||||
Term loan retirement period | 12 months | |||||
Final payment | $ 26,000 | |||||
Term Loan | Robert McEwen | ||||||
LONG-TERM DEBT | ||||||
Face amount | $ 50,000 | |||||
Term of debt instrument | 3 years | |||||
Long-term debt from related party | $ 25,000 | |||||
Term Loan | Affiliate of Robert McEwen | ||||||
LONG-TERM DEBT | ||||||
Percentage of ownership of the Company's common stock | 20.00% | |||||
Long-term debt from related party | $ 25,000 |
DEBT- Rollforward (Details)
DEBT- Rollforward (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Long-term debt | ||
Balance, initial recognition | $ 49,600 | $ 49,500 |
Long-term portion | 16,799 | 19,758 |
Term Loan | Gold Bar Complex | ||
Long-term debt | ||
Balance, beginning of year | 49,516 | 49,206 |
Interest expense | 1,297 | 5,185 |
Interest payments | (1,215) | (4,875) |
Balance, end of year | 49,598 | 49,516 |
Less current portion | 16,000 | 10,000 |
Long-term portion | $ 33,598 | $ 39,516 |
ASSET RETIREMENT OBLIGATIONS -
ASSET RETIREMENT OBLIGATIONS - Retirement obligation rollforward (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Changes in the asset retirement obligations | |||
Asset retirement obligation, beginning of the period | $ 32,201 | $ 29,402 | $ 29,402 |
Settlements | (90) | (513) | |
Accretion of liability | 457 | 1,680 | |
Adjustment reflecting updated estimates | 262 | 1,012 | |
Foreign exchange revaluation | (927) | 620 | |
Asset retirement obligation, ending balance | 31,903 | 32,201 | |
Less current portion | 1,905 | 2,610 | |
Long-term portion | 29,998 | $ 29,591 | |
Reclamation obligations | |||
Reclamation adjustment reflecting updated estimates | 203 | 64 | |
Remediation Accretion | 457 | 397 | |
Total | $ 660 | $ 461 |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands | May 23, 2019 | Mar. 29, 2019 | Nov. 08, 2018 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2017 |
Number of units issued | 1,935,484 | 14,193,548 | ||||
Price per unit | $ 1.55 | |||||
Net proceeds | $ 2,600 | $ 20,300 | $ 20,252 | |||
Issuance costs | $ 400 | $ 1,700 | ||||
Number of shares of common stock | 1 | |||||
Number of warrants received for each share of common stock share sold | 0.5 | |||||
Sale of common stock for cash, net of issuance costs | $ 20,252 | |||||
Shares of common stock issued upon exercise of stock options | 60,000 | 221,500 | ||||
Proceeds from exercise of stock options | $ 62 | $ 223 | ||||
Weighted average exercise price of stock options (in dollars per share) | $ 1.06 | $ 1 | ||||
Shareholders' distribution declared per common share (note 13) | 0 | 0 | ||||
Annual return of capital declared (in dollars per share) | $ 0.01 | |||||
Maximum | ||||||
Proceeds from exercise of stock options | $ 200 | |||||
Common Stock and Additional Paid-in Capital | ||||||
Number of units issued | 14,194,000 | |||||
Net proceeds | $ 17,800 | $ 20,252 | ||||
Shares of common stock issued upon exercise of stock options | 60,000 | 222,000 | ||||
Warrants | ||||||
Net proceeds | $ 2,500 | |||||
Number of shares of common stock | 1 | |||||
Price per common share for each warrant | $ 2 | |||||
Warrant expiration term | 3 years | |||||
Subscription Receipts | Officers, directors and certain employees | ||||||
Number of units issued | 1,935,484 | |||||
Price per unit | $ 1.55 | |||||
ATM offering | ||||||
Number of units issued | 1,010,545 | |||||
Aggregate offering price | $ 90,000 | |||||
Sale of common stock for cash, net of issuance costs | $ 1,900 |
NET LOSS PER SHARE (Details)
NET LOSS PER SHARE (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Options and warrants outstanding not included in the computation of diluted weighted average shares because their effect would have been anti-dilutive (in shares) | 4,430,784 | 3,838,317 |
Warrants | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||
Options and warrants outstanding not included in the computation of diluted weighted average shares because their effect would have been anti-dilutive (in shares) | 29,770,766 | 7,096,744 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Aug. 10, 2018 | |
RELATED PARTY TRANSACTIONS | ||||
Long-term debt from related party (note 18) | $ 16,799 | $ 19,758 | ||
Term Loan | ||||
RELATED PARTY TRANSACTIONS | ||||
Face amount | $ 50,000 | |||
Robert McEwen | Term Loan | ||||
RELATED PARTY TRANSACTIONS | ||||
Face amount | 50,000 | |||
Long-term debt from related party (note 18) | 25,000 | |||
Affiliate of Robert McEwen | ||||
RELATED PARTY TRANSACTIONS | ||||
Debt interest expense | 600 | $ 600 | ||
Affiliate of Robert McEwen | Term Loan | ||||
RELATED PARTY TRANSACTIONS | ||||
Long-term debt from related party (note 18) | $ 25,000 | |||
Entity Affiliated With Related Party | Lexam L.P. | ||||
RELATED PARTY TRANSACTIONS | ||||
Expense | 76 | 61 | ||
Related party outstanding accounts payable | 76 | 65 | ||
Entity Affiliated With Related Party | REVlaw | ||||
RELATED PARTY TRANSACTIONS | ||||
Expense | 38 | $ 41 | ||
Related party outstanding accounts payable | $ 20 | $ 12 |
FAIR VALUE ACCOUNTING (Details)
FAIR VALUE ACCOUNTING (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Assets: | ||
Long term debt | $ 49,600 | $ 49,500 |
Debt term | 17 months | |
Gold Bar mine | ||
Assets: | ||
Impairment of long-lived assets | $ 83,800 | |
Marketable equity securities. | Recurring | ||
Assets: | ||
Investments | 875 | 1,885 |
Marketable equity securities. | Recurring | Level 1 | ||
Assets: | ||
Investments | $ 875 | $ 1,885 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Reclamation Bonds, surety bonds (Details) $ in Thousands, $ in Millions | 3 Months Ended | |
Mar. 31, 2020CAD ($) | Mar. 31, 2020USD ($) | |
Timmins | ||
Reclamation Bonds | ||
Restrictive time deposits for reclamation bonding | $ 100 | |
Surety Bonds | ||
Reclamation Bonds | ||
Percentage of annual fees on surety bonds | 2.00% | 2.00% |
Surety bonds upfront deposit amount | $ 0 | |
Surety bonding obligation | 20,100 | |
Surety Bonds | Canada | ||
Reclamation Bonds | ||
Surety bonding obligation | $ 14.9 | 10,500 |
Reclamation Bonds | Tonkin and Gold Bar Properties | ||
Reclamation Bonds | ||
Reclamation bonding obligation | 20,100 | |
Black Fox | Reclamation Bonds | ||
Reclamation Bonds | ||
Reclamation bonding obligation | $ 14.9 | $ 10,500 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Streaming Agreement (Details) $ in Millions | Aug. 25, 2017$ / oz | Mar. 31, 2020USD ($) | Mar. 31, 2019USD ($) |
Black Fox | |||
Other commitments | |||
Obligation to sell (as a percent) | 8.00% | ||
Long term gold price (in dollars per ounce) | $ / oz | 561 | ||
Revenue of acquiree since acquisition date and implementation of streaming agreement | $ | $ 0.5 | $ 0.4 | |
Black Fox | Maximum | |||
Other commitments | |||
Inflation adjustment (as a percent) | 2.00% | ||
Pike River property | |||
Other commitments | |||
Obligation to sell (as a percent) | 6.30% |
CASH AND CASH EQUIVALENTS AND_3
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | ||||
Cash and cash equivalents | $ 28,774 | $ 46,452 | ||
Restricted cash included in other assets | 48 | 48 | ||
Total cash, cash equivalents, and restricted cash | $ 28,822 | $ 46,500 | $ 26,717 | $ 30,489 |