Exhibit 99.1
CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED
MARCH 31, 2021 AND 2020
(unaudited)
Contents
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 2 |
SSR Mining Inc.
Condensed Consolidated Interim Statements of Financial Position
(expressed in thousands of United States dollars, except for per share amounts)
(Unaudited)
Note |
March 31, 2021 |
December 31, 2020 | ||||||||||
Current assets | ||||||||||||
Cash and cash equivalents | $ | 866,029 | $ | 860,637 | ||||||||
Marketable securities | 25,942 | 26,748 | ||||||||||
Trade and other receivables | 97,442 | 83,491 | ||||||||||
Inventories | 4 | 429,678 | 437,379 | |||||||||
Prepaids and other current assets | 19,302 | 16,267 | ||||||||||
1,438,393 | 1,424,522 | |||||||||||
Non-current assets | ||||||||||||
Mineral properties, plant and equipment | 5 | 3,558,688 | 3,565,905 | |||||||||
Inventories - non-current | 4 | 162,427 | 134,612 | |||||||||
Restricted cash | 35,290 | 35,288 | ||||||||||
Investments in joint ventures | 6,776 | 7,782 | ||||||||||
Goodwill | 49,786 | 49,786 | ||||||||||
Deferred income tax assets | 1,924 | 4,612 | ||||||||||
Other | 19,843 | 22,479 | ||||||||||
Total assets | $ | 5,273,127 | $ | 5,244,986 | ||||||||
Current liabilities | ||||||||||||
Accounts payable and accrued liabilities | $ | 164,567 | $ | 175,984 | ||||||||
Debt | 6 | 71,090 | 71,025 | |||||||||
Reclamation and closure cost provision | 2,747 | 1,924 | ||||||||||
238,404 | 248,933 | |||||||||||
Non-current liabilities | ||||||||||||
Debt | 6 | 303,892 | 319,645 | |||||||||
Lease liabilities | 116,517 | 117,029 | ||||||||||
Reclamation and closure cost provision | 121,613 | 117,650 | ||||||||||
Deferred income tax liabilities | 522,841 | 483,449 | ||||||||||
Other | 4,857 | 18,377 | ||||||||||
Total liabilities | 1,308,124 | 1,305,083 | ||||||||||
Shareholders' equity | ||||||||||||
Common shares | 3,226,627 | 3,220,795 | ||||||||||
Other reserves | 49,154 | 40,570 | ||||||||||
Equity component of convertible notes | 106,425 | 106,425 | ||||||||||
Retained earnings | 100,475 | 58,487 | ||||||||||
Total equity attributable to equity holders of SSR Mining | 3,482,681 | 3,426,277 | ||||||||||
Non-controlling interest | 482,322 | 513,626 | ||||||||||
Total equity | 3,965,003 | 3,939,903 | ||||||||||
Total liabilities and equity | $ | 5,273,127 | $ | 5,244,986 | ||||||||
The accompanying notes are an integral part of the consolidated financial statements |
Approved by the Board of Directors and authorized for issue on May 4, 2021.
"Beverlee F. Park" | "Rodney P. Antal" | |
Beverlee F. Park, Director | Rodney P. Antal, Director |
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 3 |
SSR Mining Inc.
Condensed Consolidated Interim Statements of Income
(expressed in thousands of United States dollars, except for per share amounts)
(Unaudited)
Three months ended March 31, | ||||||||||||
Note | 2021 | 2020 | ||||||||||
Revenue | 7 | $ | 366,484 | $ | 164,463 | |||||||
Cost of sales | ||||||||||||
Production costs | (157,492 | ) | (91,045 | ) | ||||||||
Depletion and depreciation | (61,172 | ) | (28,635 | ) | ||||||||
(218,664 | ) | (119,680 | ) | |||||||||
Income from mine operations | 147,820 | 44,783 | ||||||||||
General and administrative expense | (11,867 | ) | (5,893 | ) | ||||||||
Share-based compensation recovery | 9 | 4,507 | 3,568 | |||||||||
Exploration, evaluation and reclamation expense | (7,955 | ) | (6,362 | ) | ||||||||
Care and maintenance expense | 11 | — | (1,330 | ) | ||||||||
Transaction and integration expense | (4,492 | ) | — | |||||||||
Operating income | 128,013 | 34,766 | ||||||||||
Interest and other finance income | 470 | 2,397 | ||||||||||
Interest expense and other finance costs | (7,945 | ) | (6,966 | ) | ||||||||
Other expense | (2,180 | ) | (1,380 | ) | ||||||||
Foreign exchange (loss) gain | (424 | ) | 1,158 | |||||||||
Income before income taxes | 117,934 | 29,975 | ||||||||||
Income tax expense | (58,172 | ) | (5,999 | ) | ||||||||
Net income | $ | 59,762 | $ | 23,976 | ||||||||
Attributable to: | ||||||||||||
Equity holders of SSR Mining | $ | 52,980 | $ | 23,976 | ||||||||
Non-controlling interest | 6,782 | — | ||||||||||
$ | 59,762 | $ | 23,976 | |||||||||
Net income per share attributable to equity holders of SSR Mining | ||||||||||||
Basic | 8 | $ | 0.24 | $ | 0.19 | |||||||
Diluted | 8 | $ | 0.24 | $ | 0.19 |
The accompanying notes are an integral part of the consolidated financial statements
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 4 |
SSR Mining Inc.
Condensed Consolidated Interim Statements of Comprehensive Income
(expressed in thousands of United States dollars)
(Unaudited)
2021 | 2020 | ||||||||
Net income | $ | 59,762 | $ | 23,976 | |||||
Other comprehensive income | |||||||||
Items that will not be reclassified to net income: | |||||||||
Loss on marketable securities at FVTOCI, net of tax recovery of $109 and $2,382 | (697 | ) | (13,497 | ) | |||||
Items that may be subsequently reclassified to net income: | |||||||||
Unrealized gain (loss) on effective portion of derivative, net of tax (expense) recovery of $(726) and $2,633 | 2,582 | (9,092 | ) | ||||||
Realized (gain) loss on derivatives reclassified to net income, net of tax expense (recovery) of $63 and $(9) | (147 | ) | 34 | ||||||
Total other comprehensive income | 1,738 | (22,555 | ) | ||||||
Total comprehensive income | $ | 61,500 | $ | 1,421 | |||||
Attributable to: | |||||||||
Equity holders of SSR Mining | $ | 54,718 | $ | 1,421 | |||||
Non-controlling interest | 6,782 | — | |||||||
Total comprehensive income | $ | 61,500 | $ | 1,421 |
The accompanying notes are an integral part of the consolidated financial statements.
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 5 |
SSR Mining Inc.
Condensed Consolidated Interim Statements of Cash Flows
(expressed in thousands of United States dollars)
(Unaudited)
Note | 2021 | 2020 | ||||||||||
Cash flows from operating activities | ||||||||||||
Net income for the period | $ | 59,762 | $ | 23,976 | ||||||||
Adjustments for: | ||||||||||||
Depletion and depreciation | 61,375 | 28,806 | ||||||||||
Interest and other finance income | (470 | ) | (2,397 | ) | ||||||||
Interest expense | 7,444 | 6,439 | ||||||||||
Income tax expense | 58,172 | 5,999 | ||||||||||
Non-cash foreign exchange (gain) | (997 | ) | (1,306 | ) | ||||||||
Other | 13 | 9,697 | 13,659 | |||||||||
Net change in operating assets and liabilities | 13 | (39,423 | ) | (290 | ) | |||||||
Cash generated from operating activities before taxes | 155,560 | 74,886 | ||||||||||
Income taxes paid | (10,339 | ) | (10,750 | ) | ||||||||
Cash generated by operating activities | 145,221 | 64,136 | ||||||||||
Cash flows from investing activities | ||||||||||||
Expenditures on mineral properties, plant and equipment | (68,579 | ) | (53,903 | ) | ||||||||
Purchases of marketable securities | — | (10,147 | ) | |||||||||
Net proceeds from sales of marketable securities | — | 12,055 | ||||||||||
Interest received | 551 | 1,783 | ||||||||||
Other | (25 | ) | 851 | |||||||||
Cash used in investing activities | (68,053 | ) | (49,361 | ) | ||||||||
Cash flows from financing activities | ||||||||||||
Repayment of debt, principal | 6 | (17,500 | ) | — | ||||||||
Interest paid | 6 | (4,665 | ) | (5,464 | ) | |||||||
Redemption of convertible notes | 6 | — | (114,994 | ) | ||||||||
Proceeds from exercise of stock options | 2,749 | 1,387 | ||||||||||
Lease payments | (2,874 | ) | (376 | ) | ||||||||
Dividends paid to equity holders of SSR Mining | 10 | (10,992 | ) | — | ||||||||
Dividends paid to non-controlling interest | (38,086 | ) | — | |||||||||
Other | (420 | ) | — | |||||||||
Cash used in financing activities | (71,788 | ) | (119,447 | ) | ||||||||
Effect of foreign exchange rate changes on cash and cash equivalents | 12 | (536 | ) | |||||||||
Increase (decrease) in cash and cash equivalents | 5,392 | (105,208 | ) | |||||||||
Cash and cash equivalents, beginning of year | 860,637 | 503,647 | ||||||||||
Cash and cash equivalents, end of period | $ | 866,029 | $ | 398,439 |
Supplemental cash flow information (note 13)
The accompanying notes are an integral part of the consolidated financial statements.
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 6 |
SSR Mining Inc.
Condensed Consolidated Interim Statements of Changes in Shareholders' Equity
(expressed in thousands of United States dollars)
(Unaudited)
Common shares | ||||||||||||||||||||||||||||||||||||
Note | Number of shares (000's) | Amount | Other reserves | Equity component of convertible notes | Retained earnings (deficit) | Total equity attributable to equity holders of SSR Mining | Non- controlling interest | Total equity | ||||||||||||||||||||||||||||
Balance, January 1, 2020 | 123,084 | $ | 1,083,766 | $ | 19,762 | $ | 106,425 | $ | (75,999 | ) | $ | 1,133,954 | $ | — | $ | 1,133,954 | ||||||||||||||||||||
Exercise of stock options and settlement of RSUs | 157 | 1,975 | (588 | ) | — | — | 1,387 | — | 1,387 | |||||||||||||||||||||||||||
Equity-settled share-based compensation | 9 | — | — | 1,223 | — | — | 1,223 | — | 1,223 | |||||||||||||||||||||||||||
Equity value of convertible debt redeemed | — | 6 | — | — | — | 6 | — | 6 | ||||||||||||||||||||||||||||
Total comprehensive income (loss) for the period | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | 23,976 | 23,976 | — | 23,976 | ||||||||||||||||||||||||||||
Other comprehensive loss | — | — | (22,555 | ) | — | — | (22,555 | ) | — | (22,555 | ) | |||||||||||||||||||||||||
— | — | (22,555 | ) | — | 23,976 | 1,421 | — | 1,421 | ||||||||||||||||||||||||||||
Balance, March 31, 2020 | 123,241 | $ | 1,085,747 | $ | (2,158 | ) | $ | 106,425 | $ | (52,023 | ) | $ | 1,137,991 | $ | — | $ | 1,137,991 | |||||||||||||||||||
Balance, January 1, 2021 | 219,607 | 3,220,795 | 40,570 | 106,425 | 58,487 | 3,426,277 | 513,626 | 3,939,903 | ||||||||||||||||||||||||||||
Exercise of stock options | 364 | 3,966 | (1,216 | ) | — | — | 2,750 | — | 2,750 | |||||||||||||||||||||||||||
Settlement of RSUs and PSUs | 92 | 1,866 | (1,777 | ) | — | — | 89 | — | 89 | |||||||||||||||||||||||||||
Transfer of cash-settled RSUs | — | — | 8,802 | — | — | 8,802 | — | 8,802 | ||||||||||||||||||||||||||||
Equity-settled share-based compensation | 9 | — | — | 1,037 | — | — | 1,037 | — | 1,037 | |||||||||||||||||||||||||||
Dividends paid | 10 | — | — | — | — | (10,992 | ) | (10,992 | ) | (38,086 | ) | (49,078 | ) | |||||||||||||||||||||||
Total comprehensive income for the period | ||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | 52,980 | 52,980 | 6,782 | 59,762 | ||||||||||||||||||||||||||||
Other comprehensive income | — | — | 1,738 | — | — | 1,738 | — | 1,738 | ||||||||||||||||||||||||||||
— | — | 1,738 | — | 52,980 | 54,718 | 6,782 | 61,500 | |||||||||||||||||||||||||||||
Balance, March 31, 2021 | $ | 220,063 | $ | 3,226,627 | $ | 49,154 | $ | 106,425 | $ | 100,475 | $ | 3,482,681 | $ | 482,322 | $ | 3,965,003 |
The accompanying notes are an integral part of the consolidated financial statements.
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 7 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
1. | NATURE OF OPERATIONS |
SSR Mining Inc. (the "Company" or "SSR Mining") is a company incorporated under the laws of the Province of British Columbia, Canada. The Company's common shares are listed on the Toronto Stock Exchange (TSX) in Canada and the Nasdaq Global Select Market (NASDAQ) in the United States under the symbol "SSRM" and the Australian Securities Exchange (ASX) in Australia under the symbol "SSR".
The Company and its subsidiaries (collectively, the "Group") are principally engaged in the operation, acquisition, exploration and development of precious metal resource properties located in Turkey and the Americas. The Company has four producing mines in Argentina, Canada, Turkey and the United States. SSR Mining Inc. is the ultimate parent of the Group.
The Company's focus is on safe, profitable gold and silver production from its Çöpler Gold Mine ("Çöpler") in Erzincan, Turkey, Marigold mine ("Marigold") in Nevada, USA, Seabee Gold Operation ("Seabee") in Saskatchewan, Canada and Puna Operations ("Puna") in Jujuy, Argentina, and to advance, as market and project conditions permit, its principal development projects toward commercial production.
On September 16, 2020, the Company acquired all of the issued and outstanding common shares of Alacer Gold Corp. ("Alacer"). The Company determined that the transaction represented a business combination under IFRS 3, with SSR Mining identified as the acquiror. Based upon the September 15, 2020 closing share price of the Company's common shares, the total consideration of the acquisition was $2.2 billion.
In accordance with the acquisition method of accounting, the consideration transferred was allocated to the underlying assets acquired and liabilities assumed, based upon their estimated fair values as at the date of acquisition.
Significant Developments During the Three Months Ended March 31, 2021
COVID-19 Response and Impact on Operations
During the three months ended March 31, 2021, the COVID-19 pandemic continued to impact global economic and financial markets, disrupting global supply chains and workforce participation. Many industries and businesses, including SSR Mining, continue to be impacted by the COVID-19 pandemic and face operating challenges associated with the regulations and guidelines resulting from efforts to contain COVID-19.
The Company continues to restrict all non-essential travel and manage the contacts of its employees and contractors in order to reduce the risk of COVID-19 impacting its operations. The Company is operating its corporate offices at reduced capacity, with most employees working remotely.
The Company's mine sites remain operational with carefully managed COVID-19 based restrictions designed to protect employees, including quarantining, testing, ensuring physical distancing and providing additional protective equipment. In Turkey, COVID-19 continues to slow government processes including permitting, with considerable effort being expended to attain permits and land access for continued growth and operations.
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 8 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
2. | BASIS OF PRESENTATION |
(a) | Statement of compliance |
These unaudited condensed consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board ("IFRS") applicable to the preparation of interim financial statements, including IAS 34, Interim Financial Reporting, and do not include all the information required for full annual financial statements. Accordingly, these condensed consolidated interim financial statements should be read in conjunction with the Company's audited consolidated financial statements for the year ended December 31, 2020. Except as described in note 2(b), the accounting policies applied in the preparation of these unaudited condensed consolidated interim financial statements are consistent with those applied and disclosed in the Company's audited consolidated financial statements for the year ended December 31, 2020.
These statements were authorized for issue by the Board of Directors on May 4, 2021.
(b) | Interest Rate Benchmark Reform - Phase 2 Amendments |
The Company adopted Interest Rate Benchmark Reform - Phase 2: Amendments to IFRS 9, IAS 39, IFRS 4 and IFRS 16 (the "Phase 2 Amendments") effective on January 1, 2021. Interest rate benchmark reform ("Reform") refers to a global reform of interest rate benchmarks, which includes the replacement of some interbank offered rates ("IBOR") with alternative benchmark rates. The Phase 2 Amendments provide a practical expedient requiring the effective interest rate be adjusted when accounting for changes in the basis for determining the contractual cash flows of financial assets and liabilities that relate directly to the Reform rather than applying modification accounting which might have resulted in a gain or loss. In addition, the Phase 2 Amendments require disclosures to assist users in understanding the effect of the Reform on the Company's financial instruments and risk management strategy.
The Company has the following financial instruments indexed to London interbank offered rates ("LIBOR") that have not yet transitioned to alternative benchmark rates at the end of the current reporting period:
Financial instrument | Carrying amount | |||
Term Loan | $ | 192,500 | ||
Interest rate swap contracts | 1,190 | |||
Credit Facility | — |
The Company maintains a Term Loan which bears interest at the three month USD LIBOR plus a fixed interest rate margin ranging from 3.50% to 3.70% depending on the tranche and which is expected to be fully repaid in December 2023. The Company is currently working with the syndicate of lenders to assess the potential alternatives to the use of LIBOR.
The Company also maintains LIBOR interest rate swap contracts with underlying notional amounts of approximately 33% of the outstanding Term Loan balance as at March 31, 2021 through December 22, 2021. Considering the short term to maturity of the interest rate swap contracts, as well as the current expected timing of changes to alternative benchmark rates, the Company does not expect to transition to an alternative benchmark rate.
The Company further maintains a $75.0 million senior secured revolving credit facility (the "Credit Facility") with a $25.0 million accordion feature, for which amounts borrowed incur variable interest at LIBOR plus an applicable margin ranging from 2.25% to 3.75% based on the Company's net leverage ratio, among other things. The Credit Facility matures in June 2021. Considering the short term to maturity of the Credit Facility, as well as the current expected timing of changes to alternative benchmark rates, the Company does not expect to transition to an alternative benchmark rate.
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 9 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
3. | AREAS OF JUDGMENT AND ESTIMATION UNCERTAINTY |
In preparing its consolidated financial statements, the Company makes judgments in applying its accounting policies. In addition, the preparation of consolidated financial statements in conformity with IFRS requires the use of estimates that may affect the amounts reported and disclosed in the consolidated financial statements and related notes in future periods. These estimates are based on management’s best knowledge of the relevant facts and circumstances, having regard to previous experience, but actual results may differ materially from the amounts included in the consolidated financial statements. The significant accounting policy judgments and areas of estimation uncertainty in the preparation of the unaudited condensed consolidated interim financial statements for the three months ended March 31, 2021 are consistent with those applied and disclosed in note 3 to the Company's audited consolidated financial statements for the year ended December 31, 2020.
(1) | At March 31, 2021, stockpiled ore includes $8.8 million current and $160.8 million non-current stockpiled sulfide ore related to Çöpler (December 31, 2020 - $12.5 million current and $132.9 million non-current stockpiled sulfide ore related to Çöpler). |
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 10 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
5. MINERAL PROPERTIES, PLANT AND EQUIPMENT
March 31, 2021 | ||||||||||||||||||||||||
Plant and equipment (1) | Construction in process | Mineral properties subject to depletion | Mineral properties not yet subject to depletion | Exploration and evaluation assets | Total | |||||||||||||||||||
Cost | ||||||||||||||||||||||||
Balance, beginning of year | $ | 1,675,283 | $ | 43,007 | $ | 1,476,616 | $ | 225,528 | $ | 944,413 | $ | 4,364,847 | ||||||||||||
Additions | 11,392 | 42,797 | 20,000 | 2,352 | 2,367 | 78,908 | ||||||||||||||||||
Disposals/removal of fully depreciated assets | (4,436 | ) | — | — | — | — | (4,436 | ) | ||||||||||||||||
Change in reclamation and closure cost provision | — | — | 3,871 | — | — | 3,871 | ||||||||||||||||||
Transfers | 24,460 | (29,934 | ) | 12,571 | (66 | ) | (7,031 | ) | — | |||||||||||||||
Balance, end of period | 1,706,699 | 55,870 | 1,513,058 | 227,814 | 939,749 | 4,443,190 | ||||||||||||||||||
Accumulated depletion and depreciation | ||||||||||||||||||||||||
Balance, beginning of year | (432,027 | ) | — | (366,915 | ) | — | — | (798,942 | ) | |||||||||||||||
Depletion and depreciation | (30,101 | ) | — | (59,715 | ) | — | — | (89,816 | ) | |||||||||||||||
Disposals/removal of fully depreciated assets | 4,256 | — | — | — | — | 4,256 | ||||||||||||||||||
Balance, end of period | (457,872 | ) | — | (426,630 | ) | — | — | (884,502 | ) | |||||||||||||||
Carrying amount at March 31, 2021 | $ | 1,248,827 | $ | 55,870 | $ | 1,086,428 | $ | 227,814 | $ | 939,749 | $ | 3,558,688 |
December 31, 2020 | ||||||||||||||||||||||||
Plant and equipment (1) | Construction in process | Mineral properties subject to depletion | Mineral properties not yet subject to depletion | Exploration and evaluation assets | Total | |||||||||||||||||||
Cost | ||||||||||||||||||||||||
Balance, beginning of year | $ | 663,368 | $ | 28,208 | $ | 539,378 | $ | 80,296 | $ | 127,141 | $ | 1,438,391 | ||||||||||||
Alacer acquisition | 926,228 | 26,874 | 882,742 | 146,086 | 807,902 | 2,789,832 | ||||||||||||||||||
Additions | 2,927 | 104,475 | 55,477 | 2,714 | 7,980 | 173,573 | ||||||||||||||||||
Disposals/removal of fully depreciated assets | (22,466 | ) | (297 | ) | (24,373 | ) | — | — | (47,136 | ) | ||||||||||||||
Change in reclamation and closure cost provision | — | — | 8,799 | — | 1,388 | 10,187 | ||||||||||||||||||
Transfers | 105,226 | (116,253 | ) | 14,593 | (3,568 | ) | 2 | — | ||||||||||||||||
Balance, end of year | 1,675,283 | 43,007 | 1,476,616 | 225,528 | 944,413 | 4,364,847 | ||||||||||||||||||
Accumulated depreciation and depletion | ||||||||||||||||||||||||
Balance, beginning of year | (375,398 | ) | — | (293,531 | ) | — | — | (668,929 | ) | |||||||||||||||
Depreciation and depletion | (73,041 | ) | — | (97,757 | ) | — | — | (170,798 | ) | |||||||||||||||
Disposals/removal of fully depreciated assets | 16,412 | — | 24,373 | — | — | 40,785 | ||||||||||||||||||
Balance, end of year | (432,027 | ) | — | (366,915 | ) | — | — | (798,942 | ) | |||||||||||||||
Carrying amount at December 31, 2020 | $ | 1,243,256 | $ | 43,007 | $ | 1,109,701 | $ | 225,528 | $ | 944,413 | $ | 3,565,905 |
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 11 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
6. DEBT AND CREDIT FACILITY | ||||||||
March 31, 2021 | December 31, 2020 | |||||||
2019 Notes | $ | 179,658 | $ | 177,582 | ||||
Term Loan | 192,500 | 210,000 | ||||||
Other | 2,824 | 3,088 | ||||||
Total carrying amount | $ | 374,982 | $ | 390,670 |
The following is a reconciliation of the changes in the Company's debt balance to cash flows arising from financing activities:
March 31, 2021 | December 31, 2020 | |||||||
Balance, beginning of year (1) | $ | 392,412 | $ | 286,852 | ||||
Financing cash flows: | ||||||||
Interest paid | (4,665 | ) | (12,444 | ) | ||||
Redemption of 2013 Notes | — | (114,994 | ) | |||||
Principal paid on Term Loan | (17,500 | ) | (35,000 | ) | ||||
Other | (264 | ) | — | |||||
Other changes: | ||||||||
Interest expense | 5,264 | 19,916 | ||||||
Redemption of 2013 Notes - converted to equity | — | (6 | ) | |||||
Term Loan | — | 245,000 | ||||||
Issuance of debt | — | 3,088 | ||||||
Balance, end of period (1) | 375,247 | 392,412 | ||||||
Less: accrued interest | (265 | ) | (1,742 | ) | ||||
Carrying amount, end of period | $ | 374,982 | $ | 390,670 | ||||
Classified as: | ||||||||
Current | $ | 71,090 | $ | 71,025 | ||||
Non-current | 303,892 | 319,645 | ||||||
$ | 374,982 | $ | 390,670 |
(1) Includes accrued interest presented within accounts payable and accrued liabilities.
7. | REVENUE |
Three months ended March 31 | ||||||||
2021 | 2020 | |||||||
Gold bullion and doré sales | $ | 313,135 | $ | 136,777 | ||||
Concentrate sales | 53,928 | 35,623 | ||||||
Other (1) | (579) | (7,937 | ) | |||||
$ | 366,484 | $ | 164,463 |
(1) | Other revenue includes: changes in the fair value of concentrate trade receivables due to changes in silver and base metal prices; and silver and copper by-product revenue arising from the production and sale of gold bullion and doré. |
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 12 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
8. | INCOME PER SHARE |
The calculations of basic and diluted income per share attributable to equity holders of SSR Mining for the three months ended March 31, 2021 and 2020 are based on the following:
Three months ended March 31, | ||||||||
2021 | 2020 | |||||||
Net income | $ | 59,762 | $ | 23,976 | ||||
Net (income) attributable to non-controlling interest | (6,782 | ) | — | |||||
Net income attributable to equity holders of SSR Mining | 52,980 | 23,976 | ||||||
Adjustment for dilutive instruments | ||||||||
Interest saving on convertible notes, net of tax | 2,550 | — | ||||||
Net income used in the calculation of diluted net income per share | $ | 55,530 | $ | 23,976 | ||||
Weighted average number of common shares issued | 219,792 | 123,228 | ||||||
Adjustments for dilutive instruments: | ||||||||
Stock options | 307 | 681 | ||||||
Performance share units | — | 547 | ||||||
Restricted share units | 1,063 | — | ||||||
Convertible notes | 12,445 | — | ||||||
Diluted weighted average number of shares outstanding | 233,607 | 124,456 | ||||||
Net income per share attributable to equity holders of SSR Mining | ||||||||
Basic | $ | 0.24 | $ | 0.19 | ||||
Diluted | $ | 0.24 | $ | 0.19 |
9. | SHARE-BASED COMPENSATION |
Total share-based compensation expense, including all equity and cash-settled arrangements, for the three months ended March 31, 2021 and 2020 has been recognized in the consolidated financial statements as follows:
Three months ended March 31, | ||||||||
2021 | 2020 | |||||||
Equity-settled | ||||||||
Production costs | $ | 282 | $ | 68 | ||||
Share-based compensation expense (recovery) | 731 | 1,145 | ||||||
Exploration, evaluation and reclamation expense (recovery) | 24 | 10 | ||||||
Cash-settled | ||||||||
Production costs | 330 | 270 | ||||||
Share-based compensation expense (recovery) | (5,238 | ) | (4,714 | ) | ||||
Exploration, evaluation and reclamation expense (recovery) | 7 | (37 | ) | |||||
Transaction and integration expense | 2,165 | — | ||||||
$ | (1,699 | ) | $ | (3,258 | ) |
Under the Company's share compensation plans, there is the option to settle vested Restricted Share Units ("RSUs") in either cash or common shares. On February 10, 2021, the Company's Board of Directors indicated its intention to settle all the RSUs issued under the Company's plans, when vested, in common shares of SSR Mining. Prior to this date, based on a past history of settling RSUs in cash, the Company had accounted for these awards as liabilities. As a result of this change, the value of the relevant outstanding RSUs was fixed at the date of modification and the existing liability of $8,802,000 ($6,426,000 net of tax) was transferred to the share-based compensation reserve of shareholders' equity. The unamortized portion of $8,074,000 relating to these RSUs will be amortized over the remaining vesting periods.
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 13 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
10. | DIVIDENDS |
On March 31, 2021, the Company paid a cash dividend of $0.05 per common share to shareholders of record on March 5, 2021, totaling $11 million.
Subsequent to March 31, 2021, the Board of Directors declared a quarterly cash dividend of $0.05 per common share, payable on June 14, 2021 to holders of record at the close of business on May 17, 2021.
11. | OPERATING SEGMENTS |
Results of operating segments are reviewed by the Company's chief operating decision maker ("CODM") to make decisions about resources to be allocated to the segments and to assess their performance. Each individual operating mine site is considered to be a reportable operating segment for financial reporting purposes.
In connection with the acquisition of Alacer on September 16, 2020, the Company added Çöpler as a new operating segment.
The following is a summary of the reported amounts of income from mine operations, operating income (loss), income (loss) before income taxes and the carrying amounts of assets and liabilities by operating segment:
Three months ended March 31, 2021 | Çöpler | Marigold | Seabee | Puna (1) | Exploration, evaluation and development properties | Other reconciling items (2) | Total | |||||||||||||||||||||
Revenue | $ | 151,522 | $ | 115,973 | $ | 45,707 | $ | 53,282 | $ | — | $ | — | $ | 366,484 | ||||||||||||||
Production costs | (66,028 | ) | (51,955 | ) | (16,742 | ) | (22,767 | ) | — | — | (157,492 | ) | ||||||||||||||||
Depletion and depreciation | (31,072 | ) | (14,293 | ) | (9,622 | ) | (6,185 | ) | — | — | (61,172 | ) | ||||||||||||||||
Cost of sales | (97,100 | ) | (66,248 | ) | (26,364 | ) | (28,952 | ) | — | — | (218,664 | ) | ||||||||||||||||
Income from mine operations | 54,422 | 49,725 | 19,343 | 24,330 | — | — | 147,820 | |||||||||||||||||||||
Exploration, evaluation and reclamation expense | (2,840 | ) | (407 | ) | (2,795 | ) | (19 | ) | (1,652 | ) | (242 | ) | (7,955 | ) | ||||||||||||||
Transaction and integration expense | — | — | — | — | — | (4,492 | ) | (4,492 | ) | |||||||||||||||||||
Operating income (loss) | 48,117 | 49,421 | 16,639 | 23,227 | (1,652 | ) | (7,739 | ) | 128,013 | |||||||||||||||||||
Income (loss) before income tax | 47,096 | 49,138 | 16,534 | 20,317 | (1,987 | ) | (13,164 | ) | 117,934 | |||||||||||||||||||
As at March 31, 2021 | ||||||||||||||||||||||||||||
Total assets | $ | 2,323,553 | $ | 688,903 | $ | 469,952 | $ | 256,659 | $ | 1,037,942 | $ | 496,118 | $ | 5,273,127 | ||||||||||||||
Non-current assets | 2,011,916 | 308,780 | 318,692 | 142,108 | 1,036,742 | 16,496 | 3,834,734 | |||||||||||||||||||||
Total liabilities | (776,490 | ) | (128,568 | ) | (94,285 | ) | (54,251 | ) | (28,938 | ) | (225,592 | ) | (1,308,124 | ) |
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 14 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
11. | OPERATING SEGMENTS (continued) |
Three months ended March 31, 2020 | Marigold | Seabee | Puna (1) | Exploration, evaluation and development properties | Other reconciling items (2) | Total | ||||||||||||||||||
Revenue | $ | 92,081 | $ | 44,697 | $ | 27,685 | $ | — | $ | — | $ | 164,463 | ||||||||||||
Production costs | (47,771 | ) | (15,048 | ) | (28,226 | ) | — | — | (91,045 | ) | ||||||||||||||
Depletion and depreciation | (11,853 | ) | (9,918 | ) | (6,864 | ) | — | — | (28,635 | ) | ||||||||||||||
Cost of sales | (59,624 | ) | (24,966 | ) | (35,090 | ) | — | — | (119,680 | ) | ||||||||||||||
Income from mine operations | 32,457 | 19,731 | (7,405 | ) | — | — | 44,783 | |||||||||||||||||
Exploration, evaluation and reclamation expense | (732 | ) | (2,437 | ) | (150 | ) | (2,782 | ) | (261 | ) | (6,362 | ) | ||||||||||||
Care and maintenance expense (3) | — | — | (1,330 | ) | — | — | (1,330 | ) | ||||||||||||||||
Operating income (loss) | 32,348 | 17,294 | (9,092 | ) | (2,782 | ) | (3,002 | ) | 34,766 | |||||||||||||||
Income (loss) before income tax | 32,356 | 15,359 | (11,923 | ) | (3,197 | ) | (2,620 | ) | 29,975 | |||||||||||||||
As at March 31, 2020 | ||||||||||||||||||||||||
Total assets | $ | 545,386 | $ | 439,520 | $ | 235,377 | $ | 116,070 | $ | 275,651 | $ | 1,612,004 | ||||||||||||
Non-current assets | 266,663 | 313,553 | 151,682 | 114,891 | 21,972 | 868,761 | ||||||||||||||||||
Total liabilities | (109,295 | ) | (96,848 | ) | (53,922 | ) | (20,903 | ) | (193,045 | ) | (474,013 | ) |
(1) | Cost of sales at Puna include a write-down of metal inventories to net realizable value of $nil for the three months ended March 31, 2021 (March 31, 2020 - $8.5 million). |
(2) | Other reconciling items refer to items that are not reported as part of segment performance as they are managed on a corporate basis. |
(3) | On March 20, 2020 and March 25, 2020, due to the COVID-19 pandemic, the Company temporarily suspended operations at Puna and Seabee, respectively. While the operations were suspended, the Company continued to perform care and maintenance activities and incurred incremental costs as a result. These incremental costs do not relate to producing or selling metal concentrate or gold, and therefore they have been identified and presented separately within operating income (loss). |
12. | FAIR VALUE MEASUREMENTS |
(a) Fair values of financial assets and liabilities measured at fair value
The categories of the fair value hierarchy that reflect the significance of inputs used in making fair value measurements are as follows:
Level 1 - quoted prices in active markets for identical assets or liabilities;
Level 2 - inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices); and
Level 3 - inputs for the asset or liability that are not based on observable market data.
The levels in the fair value hierarchy into which the Company's financial assets and liabilities that are measured and recognized on the consolidated statements of financial position at fair value on a recurring basis were categorized as follows:
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 15 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
12. | FAIR VALUE MEASUREMENTS (continued) |
(a) | Fair values of financial assets and liabilities measured at fair value (continued) | |
Fair value at March 31, 2021 | ||||||||||||||||
Level 1 (1) | Level 2 (2) | Level 3 (3) | Total | |||||||||||||
Marketable securities | $ | 25,942 | $ | — | $ | — | $ | 25,942 | ||||||||
Trade receivables | — | 56,899 | — | 56,899 | ||||||||||||
Derivative assets | — | 2,311 | — | 2,311 | ||||||||||||
Other financial assets | — | — | 9,732 | 9,732 | ||||||||||||
Derivative liabilities | — | (1,190 | ) | — | (1,190 | ) | ||||||||||
$ | 25,942 | $ | 58,020 | $ | 9,732 | $ | 93,694 |
Fair value at December 31, 2020 | ||||||||||||||||
Level 1 (1) | Level 2 (2) | Level 3 (3) | Total | |||||||||||||
Marketable securities | $ | 26,748 | $ | — | $ | — | $ | 26,748 | ||||||||
Trade receivables | — | 38,456 | — | 38,456 | ||||||||||||
Derivative assets | — | 1,243 | — | 1,243 | ||||||||||||
Other financial assets | — | — | 9,748 | 9,748 | ||||||||||||
Derivative liabilities | — | (3,881 | ) | — | (3,881 | ) | ||||||||||
$ | 26,748 | $ | 35,818 | $ | 9,748 | $ | 72,314 |
(1) Marketable securities of publicly quoted companies, consisting of investments measured at fair value through other comprehensive income, are valued using a market approach based upon unadjusted quoted prices in an active market obtained from securities exchanges.
(2) Trade receivables relating to sales of concentrate are included in Level 2 as the basis of valuation uses quoted commodity forward prices. Derivative assets and liabilities are included in Level 2 as the basis of valuation uses quoted prices in active markets.
(3) Certain items of deferred consideration from the sale of exploration and evaluation assets are included in Level 3, as certain assumptions used in the calculation of the fair value are not based on observable market data.
During the three months ended March 31, 2021, no amounts were transferred between Levels.
(b) | Fair values of financial assets and liabilities not already measured at fair value |
As at March 31, 2021, the fair value of the 2019 Notes and Term Loan as compared to the carrying amounts were as follows:
March 31, 2021 | December 31, 2020 | |||||||||||||||||||
Level | Carrying amount | Fair value | Carrying amount | Fair value | ||||||||||||||||
2019 Notes (1) | 1 | $ | (179,658) | $ | (267,950) | $ | (177,582) | $ | (317,538 | ) | ||||||||||
Term Loan | 3 | (192,500) | (201,765) | (210,000) | (221,943 | ) | ||||||||||||||
Total borrowings | $ | (372,158) | $ | (469,715) | $ | (387,582) | $ | (539,481 | ) |
(1) The fair value disclosed for the Company's 2019 Notes is included in Level 1 as the basis of valuation uses a quoted price in an active market. The carrying amount of the 2019 Notes represents the debt component of the convertible notes, while the fair value represents both the debt and equity components of the 2019 Notes.
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 16 |
SSR Mining Inc. Notes to the Condensed Consolidated Interim Financial Statements |
(tabular amounts expressed in thousands of United States dollars unless otherwise stated) (Unaudited) |
13. | SUPPLEMENTAL CASH FLOW INFORMATION |
Adjustments for other non-cash operating activities during the three months ended March 31, 2021 and 2020 were as follows:
Three months ended March 31, | ||||||||
2021 | 2020 | |||||||
Share-based payments | $ | 1,037 | $ | 1,223 | ||||
Loss or write-down on sale of mineral properties, plant and equipment | 31 | 722 | ||||||
(Gain) loss on change in fair value of concentrate trade receivables | (940 | ) | 8,724 | |||||
Non-cash amortization of prepayments | 10,908 | 2,877 | ||||||
Other | (1,339 | ) | 113 | |||||
$ | 9,697 | $ | 13,659 |
Net change in operating assets and liabilities during the three months ended March 31, 2021 and 2020 were as follows:
Three months ended March 31, | ||||||||
2021 | 2020 | |||||||
Trade and other receivables | $ | (20,551 | ) | $ | 7,549 | |||
Other current assets | (11,733 | ) | 4,427 | |||||
Inventories | 6,140 | (347 | ) | |||||
Accounts payable and accrued liabilities | (13,547 | ) | (9,789 | ) | ||||
Reclamation and closure cost provision - current | 268 | (2,130 | ) | |||||
$ | (39,423 | ) | $ | (290 | ) |
14. | SUBSEQUENT EVENT |
On April 16, 2021, the Company received approval of its Notice of Intention to Make a Normal Course Issuer Bid (the "NCIB") to purchase its common shares through the facilities of the Toronto Stock Exchange, the NASDAQ or other Canadian and United States market places. All shares will be canceled upon purchase. Pursuant to the NCIB, the Company is able to purchase up to 10,000,000 common shares over a twelve month period commencing on April 21, 2021. The NCIB will expire no later than April 20, 2022.
SSR Mining Inc. | Interim Financial Statements Q1 2021 | 17 |