Exhibit 99.1
STILLWATER MINING REPORTS SECOND QUARTER RESULTS
BILLINGS, Mont., Aug. 8 /PRNewswire-FirstCall/ -- STILLWATER MINING COMPANY
(NYSE: SWC) reported a net loss of $0.6 million for the second quarter of 2005
or $0.01 per diluted share, on revenue of $125.4 million, compared to net income
of $13.5 million for the second quarter of 2004 or $0.15 per diluted share, on
revenue of $84.2 million. This decrease in net income reflects a $5.0 million
increase in depreciation and amortization expense on the additional capital
placed in service during 2005. Also contributing to the decrease were lower
average realized metal prices and higher costs for raw materials in 2005.
On July 7, 2005, subsequent to quarter-end, members of the United
Steelworkers' East Boulder Unit, under which the Company's employees at the East
Boulder Mine are organized, voted to approve a three-year contract effective
July 10, 2005 through July 1, 2008. The new labor agreement provides for a 3%
annual wage increase in each year of the contract.
For the first six months of 2005, the Company reported a net loss of $1.8
million, or $0.02 per diluted share, on revenue of $252.8 million, compared to
net income of $27.4 million, or $0.30 per diluted share, on revenue of $184.9
million for the first six months of 2004. The 2005 decrease in net income is
primarily driven by a $10.8 million increase in depreciation and amortization
expense, resulting from additional capital placed in service during 2005, and by
the $6.0 million cumulative benefit of a change in accounting method recorded in
2004. Earnings also were affected by lower average realized metal prices and
higher costs for raw materials in 2005.
Announcing the Company's results, Stillwater Chairman and Chief Executive
Officer, Francis R. McAllister said, "The Company is now amortizing its
development assets over a shorter period than previously due to a 2004 change in
the method of amortizing capital mine development costs. This change has reduced
reported earnings but has not affected the Company's cash flow. During the
second quarter and first half of 2005, we generated positive cash flow, even
after unusually strong spending this year for capital development and debt
repayment. At June 30, 2005, the Company held cash and cash equivalents
(including short-term investments) of $141.3 million, up from $136.6 million at
March 31, 2005 and $109.2 million at December 31, 2004."
Mr. McAllister continued, "Our focus in 2005 at the operations is to
position ourselves for improved productivity and reduced unit costs in the
future by introducing more selective mining methods and strengthening the
developed state of the mines. These efforts will require somewhat higher capital
spending than normal during 2005 and part of 2006, but they are expected to
result in more efficient and productive mining operations over the longer term."
"The operations during the quarter performed well and are on or ahead of
plan for the year. Ore production at the Stillwater Mine averaged 1,951 tons of
ore per day during the second quarter and 2,067 tons per day during the first
six months of 2005, a 2% decrease and 4% increase, respectively, over the 1,995
tons of ore per day averaged during 2004. Incremental production resources at
the Stillwater Mine in 2005 have been directed toward expanding primary
development and defining additional proven reserves rather than on increasing
production currently. At the East Boulder Mine the rate of ore production
averaged 1,273 and 1,294 tons of ore per day during the second quarter and the
first six months of 2005, respectively, a decrease of 4% and 2% from the 1,326
tons of ore per day averaged during 2004. Like Stillwater, a portion of the
productive capacity at East Boulder Mine this year has been diverted into mine
development efforts aimed at improving productivity and reducing unit costs over
the longer term."
"Reflecting the efforts at both Stillwater and East Boulder in 2005 to
improve the developed state of the mines, during the second quarter of 2005, new
primary development totaled 10,509 feet at the Stillwater Mine and 4,525 feet at
the East Boulder Mine. These numbers represent 30% and 46% increases,
respectively, from the average quarterly feet of advance achieved in 2004. Our
capital spending requirements are expected to decline in future years following
completion of the expanded 2005-2006 development program," stated Mr.
McAllister.
"At the East Boulder Mine, achieving a sustainable increase in production
rates is crucial to the longer-term economic viability of the operation. The
current capital program there targets a future sustainable production rate of
1,650 ore tons per day through accelerated primary development to increase the
number of ramp systems and working faces, additional diamond drilling associated
with increased primary development; and the development of two new ventilation
raises to surface. The added ventilation capacity will allow us to increase the
amount of diesel equipment operating underground while at the same time
improving underground air quality. The development of the first of these new
ventilation raises has progressed more slowly this year than planned, and the
Company is utilizing the delay to further extend its drill definition program
and to implement more selective mining methods at East Boulder."
"Turning to the marketing front, at the end of the second quarter of 2005,
the Company had secured platinum prices in the forward market by entering into
financially settled forward transactions covering 162,300 ounces, or about 61%
of our anticipated platinum mine production for the period from July of 2005
through May of 2007, at an overall average price of about $830 per ounce. The
Company has enjoyed the benefit of unusually high platinum prices during the
past several quarters, particularly in contrast to the relatively low market
prices for palladium over the same period. The difference in market price
between platinum and palladium has ranged from about $650 to $700 per ounce
recently, an unusually wide spread. We are concerned that this spread between
palladium and platinum prices could narrow as consumers continue to substitute
palladium for platinum in existing and new applications, driven by the lower
price of palladium. The financially settled forward transactions provide a
measure of protection to the Company against any significant decline in platinum
prices," Mr. McAllister concluded.
OPERATING RESULTS
Quarter Ended June 30
During the second quarter of 2005, the Company produced a total of 139,000
ounces of palladium and platinum, compared to 148,000 ounces of palladium and
platinum in the second quarter of 2004. The production decrease is primarily due
to the allocation of incremental production resources in 2005 toward expanded
development rather than ore extraction. Second quarter PGM production at the
Stillwater Mine decreased by 9% to approximately 99,000 ounces in 2005, compared
to 109,000 ounces in the 2004 second quarter. At the East Boulder Mine, second
quarter production of approximately 40,000 ounces was about the same as last
year.
The Company's realized prices for mine production are bolstered by long-
term sales agreements containing floor prices for palladium that currently are
well above the market price. To a lesser degree, platinum realizations were
constrained by contractual price ceilings and by unfavorable financially settled
forward contracts maturing during the quarter. Net per-ounce realizations in the
2005 second quarter were $355 for palladium and $832 for platinum, compared to
$386 and $859, respectively, in the second quarter of 2004. When platinum and
palladium sales for the second quarter of 2005 are averaged together, the
Company's combined realized price for mine production was $472 per ounce, about
4% lower than the corresponding realization for the second quarter of 2004.
However, without the palladium price floors and the constraints on platinum
prices, the average realization in the second quarter of 2005 would have been
about $359 per ounce.
During the second quarter of 2005, the Company's total cost of metals sold
was $99.5 million, compared to $48.9 million for the same period of 2004, a 104%
increase. For part of the second quarter of 2004, the Company's smelter and
refinery were shut down for rebricking and other refurbishment; during the
shutdown mine production was stockpiled for processing later and the associated
production costs remained in inventory rather than flowing into cost of metals
sold. The component of total cost of metals sold attributable to mine production
was $53.2 million for the second quarter of 2005, compared to $19.5 million for
the same period of 2004, a 173% increase. This increase fully reflects the 39%
increase in ounces sold between the two quarters, again, as a result of the
smelter rebricking in the second quarter of 2004. Depreciation and amortization
expense in the second quarter of 2005 increased by $5.0 million, or 33%, over
the second quarter of 2004 as a result of new capital development placed into
service during 2005.
Total consolidated cash costs per ounce, a non-GAAP measure of production
efficiency (discussed in detail in the Company's 2004 Annual Report on Form
10-K), increased 22% to $322 per ounce in the second quarter of 2005, compared
to $264 per ounce for the same period in 2004. The $58 per ounce increase is
primarily due to the postponement of processing costs in the second quarter of
2004 as a result of the smelter rebricking, as well as period-on-period higher
labor costs associated with the new union contract at the Stillwater Mine,
increased employee benefit and health care costs and escalation of material
costs reflecting higher prices paid for certain key raw materials in 2005.
Second quarter 2005 sales include 26,000 ounces of PGMs from catalyst
recycling -- including 11,000 ounces of palladium, 12,000 ounces of platinum and
3,000 ounces of rhodium, -- and 109,600 ounces of palladium delivered out of the
inventory received in the 2003 Norilsk Nickel transaction. At June 30, 2005, the
Company had approximately 282,600 ounces of palladium inventory remaining. If
the Company continues to deliver at the same rate as the second quarter of 2005,
the palladium received in the 2003 Norilsk Nickel transaction will be completely
sold by the end of the first quarter of 2006. Corresponding sales for the second
quarter of 2004 were 20,000 ounces of PGMs from recycling -- including 8,000
ounces of palladium, 10,000 ounces of platinum and 2,000 ounces of rhodium --
and 109,600 ounces from the palladium received in the Norilsk Nickel
transaction.
Six Months Ended June 30
During the first six months of 2005, the Company's mines produced 283,000
ounces of palladium and platinum, compared to 295,000 ounces of palladium and
platinum in the first six months of 2004. The 4% overall production decrease is
primarily due to the allocation of certain production resources in 2005 toward
further improving the developed state of the mines. Platinum and palladium
production at the Stillwater Mine decreased by 5% to approximately 204,000
ounces in the first six months of 2005, compared to 214,000 ounces for the same
period of 2004. PGM production at the East Boulder Mine also decreased, totaling
approximately 79,000 ounces in the first half of 2005, a 2% decline from the
81,000 ounces produced in the corresponding period last year.
Realized prices per ounce for mine production in the first half of 2005
averaged $355 for palladium and $827 for platinum, compared to $380 and $861,
respectively, for the same period of 2004. Palladium realizations benefited from
the floor prices included in the Company's long-term sales contracts and a small
portion of the platinum realizations were constrained by ceiling prices in the
same contracts. Net platinum realizations also were constrained by unfavorable
financially settled forward contracts settling during the period. When platinum
and palladium sales from mine production are averaged together for the six-month
period, the Company's combined net realized price was $466 per ounce, about 4%,
or $19 per ounce, lower than the 2004 first six months' combined realized price.
Without the effect of contractual price floors and ceilings and unfavorable
forward contracts, however, the Company's combined average PGM realization would
have been only about $350 per ounce for the first half of 2005.
For the first six months of 2005, the Company's total cost of metals sold
was $200.5 million, compared to $119.4 million for the same period of 2004, a
68% increase. Lower production costs for 2004 arose primarily from production
costs incurred and inventoried during the second quarter 2004 shutdown of the
Company's smelter and refinery for rebricking and other refurbishment. The
portion of total cost of metals sold attributable to mine production was $95.5
million for the first six months of 2005, compared to $66.8 million for the same
period of 2004, a 43% increase. The increase was primarily due to the 36%
increase in ounces sold in the first six months of 2005, again reflecting the
effect of the second-quarter 2004 smelter rebricking. Depreciation and
amortization expense in the first six months of 2005 increased by $10.8 million,
or 36% over the first six months of 2004, mostly as a result of the additional
capital development placed into service during 2005.
Total consolidated cash costs per ounce produced, a non-GAAP measure of
production efficiency described more fully in the Company's 2004 Annual Report
on Form 10-K, increased $44 or 16% in the first six months of 2005 to $318 per
ounce from $274 per ounce in the same period of 2004. The increase is primarily
due to the postponement of processing costs in the second quarter of 2004 as a
result of the smelter rebricking, along with 2005 increased labor costs
associated with the new union contract at the Stillwater Mine, higher employee
benefit and health care costs and escalation in material costs reflecting higher
prices paid for certain basic raw materials.
Sales for the first half of 2005 include 61,000 ounces of PGMs from catalyst
recycling -- including 22,000 ounces of palladium, 33,000 ounces of platinum and
6,000 ounces of rhodium, -- and 219,000 ounces of palladium delivered out of the
inventory received in the 2003 Norilsk Nickel transaction. Corresponding sales
for the first six months of 2004 were 47,000 ounces of PGMs from recycling --
including 15,000 ounces of palladium, 27,000 ounces of platinum and 5,000 ounces
of rhodium -- and 156,000 ounces from the palladium received in the Norilsk
Nickel transaction.
STILLWATER MINE
Quarter Ended June 30
At the Stillwater Mine, PGM production was 99,000 ounces in the second
quarter of 2005 compared to 109,000 ounces in the second quarter of 2004. During
the quarter, a total of 202,000 tons were milled with a combined mill head grade
of 0.53 ounce per ton, compared to 197,000 tons with a combined mill head grade
of 0.60 ounce per ton in the second quarter of 2004. The mining rate during the
second quarter of 2005 was approximately 1,951 tons of ore per day, compared to
2,048 tons of ore per day in the second quarter of 2004. Ore production in the
second quarter was 2% lower than the 1,995 tons of ore per day averaged during
2004, reflecting the dedication of resources in 2005 toward improving the
developed state of the mine rather than on expanding production.
During the second quarter of 2005, the total cost of revenues at the
Stillwater Mine was $52.8 million, compared to $24.9 million for the second
quarter of 2004, due to increased operating costs, royalties, and taxes, a $19.6
million change of metals inventory from mine production and a $4.0 million
increase in depreciation and amortization expense as a result of depletion of
capital development placed into service during 2005. While the Company's
smelting and refining facilities were shut down for refurbishment during the
second quarter of 2004, the Company stockpiled mill concentrates for later
processing, resulting in higher than normal production inventories.
Total cash costs per ounce, a non-GAAP measure of production efficiency,
increased to $309 for the second quarter of 2005, compared to $240 for the same
period in 2004. The increase is primarily due the postponement of processing
costs in the second quarter of 2004 as a result of the smelter rebricking, as
well as period-on-period higher labor costs associated with the new union
contract at the Stillwater Mine, increased employee benefit and health care
costs and escalating prices for certain key raw materials in 2005.
Six Months Ended June 30
For the first six months of 2005 the mine produced 204,000 ounces of
platinum and palladium, compared to 214,000 ounces for the first six months of
2004, a 5% decrease, primarily as a result of allocating incremental production
resources in 2005 toward further primary development.
During the first six months of 2005, the total cost of revenues at the
Stillwater Mine was $94.4 million, compared to $66.0 million for the first six
months of 2004, the result of increased operating costs, royalties, and taxes, a
$12.4 million decrease in metals inventory from mine production and an $8.9
million increase in depreciation and amortization expense as a result of
depletion of new capital development placed into service during 2005. As already
noted, during the refurbishment of the smelter and refinery, mill concentrates
were stockpiled for later processing, resulting in higher than normal product
inventories during the first half of 2004.
For the first six months of 2005, total cash costs per ounce, a non-GAAP
measure of production efficiency, were $303, compared to $258 during the same
period in 2004. The increase reflects the postponement of processing costs in
2004 as a result of the smelter rebricking, as well as period-on-period
increased labor costs associated with the new union contract at the Stillwater
Mine, growth in employee benefit and health care costs and higher prices paid
for certain key raw materials in 2005.
Capital Spending
During the second quarter of 2005 capital expenditures at the mine were
$12.9 million, of which $11.6 million was for capitalized mine development.
Year-to-date capital spending was $23.4 million of which $21.7 million was spent
for capitalized mine development.
EAST BOULDER MINE
Quarter Ended June 30
During the second quarter of 2005, the East Boulder Mine produced 40,000
ounces of palladium and platinum, about the same as in the second quarter of
2004. The mining rate averaged 1,273 tons of ore per day for the quarter, down
from 1,298 tons of ore per day in the second quarter of 2004, due to some of the
productive capacity of the mine being diverted into mine development efforts
that are expected to improve productivity and reduce unit costs over the longer
term. The East Boulder mill processed a total of 118,000 tons with a mill head
grade of 0.38 ounce per ton during the second quarter of 2005, compared to
116,000 tons with a mill head grade of 0.38 ounce per ton for the same quarter
last year.
During the second quarter of 2005, the total cost of revenues at the East
Boulder Mine was $20.3 million, compared to $9.5 million for the second quarter
of 2004 due to a $8.7 million period-on-period reduction in metals inventory and
a $1.0 million increase in depreciation and amortization expense as a result of
depletion of new capital development placed into service during 2005. During the
second quarter of 2004 period, the Company's smelting and refining facilities
were shut down for about a month for rebricking the smelter, during which time
mill concentrates were stockpiled for later processing, resulting in the
build-up of concentrate inventories during the 2004 period.
Total cash costs per ounce, a non-GAAP measure of production efficiency,
increased to $352 in the second quarter of 2005 compared to $333 per ounce for
the same period in 2004 due to increased employee benefit and health care costs
and higher prices for certain key raw materials in 2005.
Six Months Ended June 30
For the first six months of 2005 the East Boulder Mine produced 79,000
ounces of palladium and platinum compared to 81,000 ounces for the first six
months of 2004.
During the first six months of 2005, the total cost of revenues at the East
Boulder Mine was $41.8 million, compared to $30.7 million for the same period in
2004 due to a $6.7 million period-on-period reduction in metals inventory from
mine production and a $1.9 million increase in depreciation and amortization
expense as a result of depletion of new capital development placed into service
during 2005. During the second quarter of 2004, the Company's smelting and
refining facilities were shut down for about a month for rebricking the smelter
resulting, as already noted, in the build-up of concentrate inventories during
the period.
For the first six months of 2005, total cash costs per ounce, a non-GAAP
measure of production efficiency, increased to $356 from $318 for the same
period in 2004 due to the higher employee benefit and health care costs and
higher prices for certain key raw materials in 2005.
Capital Spending
During the second quarter of 2005, capital expenditures at the mine were
$9.5 million, of which $7.1 million was incurred for capitalized mine
development. Year-to-date capital spending is $16.5 million, of which $13.5
million was incurred for capitalized mine development.
FINANCES
Revenues
Revenues increased 49% to $125.4 million for the second quarter of 2005
compared with $84.2 million for the second quarter of 2004. The $41.2 million
increase was driven by an increase of approximately $31.5 million in mine
production revenues due to an increase in the quantity of metals sold -- 161,000
ounces in the second quarter of 2005 compared to 90,000 ounces in the same
period of 2004. During the second quarter of 2004, the Company's smelting and
refining facilities were shut down for about a month for smelter rebricking and
other refurbishment, and sales were curtailed during the shutdown.
The 2005 increase in ounces sold was offset by a 4% decrease in combined
average net realized PGM price per ounce of $472 in the second quarter of 2005,
compared to $490 in the same period of 2004, primarily as the result of
unfavorable financially settled forward contracts maturing during the 2005
quarter. Sales of 26,000 ounces from PGM recycling provided $16.8 million of
added revenue in the second quarter, compared to $12.0 million on sales of
20,000 ounces in the same period of 2004. The sale of 109,600 ounces of
palladium received in the 2003 Norilsk Nickel transaction contributed $20.7
million to revenue for the quarter, at an average realized palladium price of
approximately $189 per ounce, down from $27.8 million in the second quarter of
2004 when the average realized palladium price was $253 per ounce. Additionally,
the resale of 12,000 ounces of purchased platinum and rhodium under one of the
Company's contracts added $12.0 million to 2005 second quarter revenues.
For the first six months of 2005, revenues increased by 37% to $252.8
million, compared to $184.9 million for the same period of 2004. The $67.9
million increase was driven by a 20% increase in mine production revenues.
Revenues from mine production were $140.0 million in the first six months of
2005, compared to $116.6 million for the same period in 2004. The increase in
mine production revenues was due to an increase in the quantity of metals sold
to 300,000 ounces in the first six months of 2005 from 240,000 ounces in the
same period of 2004. Lower 2004 sales were attributable to production that was
stockpiled for processing during the shutdown of the Company's processing
facilities for refurbishment during the second quarter of 2004. The resulting
2005 sales increase was partially offset by a decrease in the Company's combined
average realized PGM price per ounce of $466 for the first six months of 2005,
compared to $485 for the same period of 2004, a 4% decrease.
Revenues from PGM recycling were $42 million for the first six months of
2005, compared to $28.2 million for the same period in 2004 primarily due to an
increase in the quantity of recycled PGMs sold to 61,000 ounces in the first six
months of 2005, from 47,000 ounces in the same period of 2004. Lower revenues in
2004, again, reflected the shutdown of the smelter and refinery for rebricking
and other refurbishment during the second quarter of 2004. Recycling revenue
also benefited modestly from higher prices for platinum and rhodium in the first
six months of 2005 as compared to the same period of 2004.
Sales of approximately 219,000 ounces of palladium received in the Norilsk
Nickel transaction generated $41.1 million in revenues during the first six
months of 2005, compared to $40.1 million in revenues on approximately 156,000
ounces of palladium sold during the same period of 2004. The average realized
price on these palladium sales was approximately $188 per ounce for the first
six months of 2005, compared to $257 per ounce for the same period in 2004,
reflecting the decrease in palladium prices period to period. Additionally, the
resale of 21,000 ounces of purchased platinum and rhodium added $29.7 million to
revenues in the first half of 2005; there were no comparable resales of
purchased metal recorded during the same period of 2004.
Cash from Operations
For the second quarter of 2005, net cash provided by operating activities
was $34.9 million, compared to $24.6 million for the comparable period of 2004.
This growth in cash provided from operating activities between the second
quarter of 2004 and the second quarter of 2005 resulted from reduced sales in
the second quarter of 2004 of mine production and recycled PGMs due to the 2004
shutdown of the Company's smelter and refinery for rebricking and other
refurbishment.
For the six months ended June 30, 2005, net cash provided by operations was
$80.3 million, compared to $39.7 million for the same period of 2004. The
increase in cash provided by operations of $40.6 million also was primarily due
to the reduced sales from mine production and recycled PGM's in 2004 while the
Company's smelter and refinery was shut down for rebricking and other
refurbishment. In addition, sales of palladium inventory received in the Norilsk
Nickel transaction increased in 2005 with the benefit of two full quarters of
sales.
Capital Expenditures
Consolidated capital expenditures totaled $22.8 million in the second
quarter of 2005, including $18.6 million incurred in connection with capitalized
mine development activities, compared to a total of $20.3 million in the same
period of 2004, which included $16.4 million capitalized mine development.
For the first six months of 2005, consolidated capital expenditures totaled
$40.2 million, of which $35.2 million was incurred in connection with
capitalized mine development activities, compared to $34.9 million for the same
period of 2004, which included $28.6 million incurred in connection with
capitalized mine development activities.
Debt
During the second quarter of 2005, the Company made $7.3 million in
principal payments against the Company's term debt facility. In accordance with
the terms of the credit facility, the Company is required to remit 25% of the
net proceeds from sales of palladium received in the Norilsk Nickel transaction
to prepay its term loan facility. Accordingly, $20.2 million of the long-term
debt has been classified as a current liability at June 30, 2005, representing
that portion of long-term debt expected to be prepaid under this arrangement
during the next twelve months. As of June 30, 2005, the Company has remitted
$14.8 million in prepayments since inception on the credit facility in
connection with the sales of palladium received in the Norilsk Nickel
transaction. Another $7.0 million was paid on August 2, 2005, based on sales
through the month of June.
At June 30, 2005, the Company has $123.9 million outstanding under its term
loan facilities bearing interest at approximately 6.375% and $14.1 million in
letters of credit issued under the revolving credit facility, bearing interest
at approximately 5.375%, posted as collateral in support of the Company's
long-term reclamation obligations. The outstanding letters of credit reduced the
amount available under the revolving credit facility to $25.9 million at June
30, 2005. The letters of credit carried an annual fee of 2.375% as of June 30,
2005. The remaining unused portion of the revolving credit facility bears an
annual commitment fee of 0.75%.
Cash Position
During the first half of 2005, cash, cash equivalents and other highly
liquid cash investments increased by $32.1 million to a total of $141.3 million
at June 30, 2005. The Company's net working capital at June 30, 2005, was $230.9
million, compared to $236.4 million at December 31, 2004. The decrease in net
working capital resulted primarily from a net reduction in operating assets and
liabilities of $37.6 million, partially offset by the $32.1 million increase in
cash and other liquid short-term investments. The Company's ratio of current
assets to current liabilities was 4.4 at June 30, 2005 down from 4.5 at December
31, 2004.
METALS MARKET
During the second quarter of 2005, the market price for palladium averaged
$192 per ounce, trading in a range between $203 and $182 per ounce, while
platinum traded as high as $900 per ounce and as low as $853 per ounce and
averaged $871 per ounce.
The palladium price traded in the $200 per ounce range early in the second
quarter but then weakened to trade for most of the balance of the quarter in the
range of $180 to $190 per ounce. Late in the quarter the palladium price spiked
up to $191 per ounce as platinum and gold prices rallied. Demand for palladium
reportedly continues to be strong this year for jewelry use in China.
Stillwater Mining Company will host its second quarter results conference
call at 12 noon Eastern Time on August 8, 2005. The conference call dial-in
number is 800-553-5260 (US) and 612-332-0636 (International). The conference
call will be simultaneously Web cast on the Internet via the Company's Web site
at www.stillwatermining.com. To access the conference call on the Company's Web
site go to the Investor Relations Section under Presentations and click on the
link to the conference call. A replay of the conference call will be available
on the Company's Web site or by a telephone replay, dial-in number 800-475-6701
(US) and 320-365-3844 (International), access code 791433, through August 15,
2005.
Stillwater Mining Company is the only U.S. producer of palladium and
platinum and is the largest primary producer of platinum group metals outside of
South Africa and Russia. The Company's shares are traded on the New York Stock
Exchange under the symbol SWC. Information on Stillwater Mining can be found at
its Web site: www.stillwatermining.com.
Some statements contained in this news release are forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended,
and, therefore, involve uncertainties or risks that could cause actual results
to differ materially. These statements may contain words such as "believes,"
"anticipates," "plans," "expects," "intends," "estimates" or similar
expressions. These statements are not guarantees of the Company's future
performance and are subject to risks, uncertainties and other important factors
that could cause our actual performance or achievements to differ materially
from those expressed or implied by these forward-looking statements. Such
statements include, but are not limited to, comments regarding expansion plans,
costs, grade, production and recovery rates, permitting, financing needs, the
terms of future credit facilities and capital expenditures, increases in
processing capacity, cost reduction measures, safety, timing for engineering
studies, and environmental permitting and compliance, litigation, labor matters
and the palladium and platinum market. Additional information regarding factors,
which could cause results to differ materially from management's expectations,
is found in the section entitled "Risk Factors" in the Company's 2004 Annual
Report on Form 10-K. The Company intends that the forward-looking statements
contained herein be subject to the above-mentioned statutory safe harbors.
Investors are cautioned not to rely on forward-looking statements. The Company
disclaims any obligation to update forward-looking statements.
Key Factors Tables and Financial Statements follow."
Stillwater Mining Company
Key Factors
(Unaudited)
Three months ended Six months ended
June 30, June 30,
OPERATING AND COST DATA ------------------------- -------------------------
FOR MINE PRODUCTION 2005 2004 2005 2004
- ---------------------------------------- ----------- ----------- ----------- -----------
Consolidated:
Ounces produced (000)
Palladium 107 114 218 228
Platinum 32 34 65 67
Total 139 148 283 295
Tons milled (000) 296 302 609 616
Mill head grade (ounce per ton) 0.50 0.53 0.50 0.52
Sub-grade tons milled (000) (1) 24 11 37 26
Sub-grade tons mill head
grade (ounce per ton) 0.16 0.28 0.17 0.24
Total tons milled (000) (1) 320 313 646 642
Combined mill head
grade (ounce per ton) 0.48 0.52 0.49 0.51
Total mill recovery (%) 91 91 91 91
Total operating
costs (000) (Non-GAAP) (2) $ 38,022 $ 33,805 $ 76,814 $ 69,401
Total cash
costs (000) (Non-GAAP) (2) $ 44,561 $ 38,930 $ 89,998 $ 81,048
Total production
costs (000) (Non-GAAP) (2) $ 64,604 $ 53,933 $ 130,969 $ 111,137
Total operating costs
per ounce (Non-GAAP) (3) $ 274 $ 230 $ 271 $ 235
Total cash costs per
ounce (Non-GAAP) (3) $ 322 $ 264 $ 318 $ 274
Total production costs
per ounce (Non-GAAP) (3) $ 466 $ 366 $ 463 $ 376
Total operating costs
per ton milled (Non-GAAP) (3) $ 119 $ 108 $ 119 $ 108
Total cash costs per
ton milled (Non-GAAP) (3) $ 139 $ 124 $ 139 $ 126
Total production costs per
ton milled (Non-GAAP) (3) $ 202 $ 172 $ 203 $ 173
Stillwater Mine:
Ounces produced (000)
Palladium 76 84 156 165
Platinum 23 25 48 49
Total 99 109 204 214
Tons milled (000) 178 186 374 381
Mill head grade (ounce per ton) 0.59 0.62 0.58 0.60
Sub-grade tons milled (000) (1) 24 11 37 26
Sub-grade tons mill head
grade (ounce per ton) 0.16 0.28 0.17 0.24
Total tons milled (000) (1) 202 197 411 407
Combined mill head
grade (ounce per ton) 0.53 0.60 0.54 0.57
Total mill recovery (%) 92 92 92 92
Total operating
costs (000) (Non-GAAP) (2) $ 26,073 $ 22,639 $ 52,844 $ 47,310
Total cash
costs (000) (Non-GAAP) (2) $ 30,591 $ 26,061 $ 61,871 $ 55,118
Total production
costs (000) (Non-GAAP) (2) $ 43,794 $ 35,212 $ 89,166 $ 73,466
Total operating costs
per ounce (Non-GAAP) (3) $ 264 $ 209 $ 259 $ 221
Total cash costs per
ounce (Non-GAAP) (3) $ 309 $ 240 $ 303 $ 258
Total production costs
per ounce (Non-GAAP) (3) $ 443 $ 324 $ 437 $ 343
Total operating costs per
ton milled (Non-GAAP) (3) $ 129 $ 115 $ 129 $ 116
Total cash costs per ton
milled (Non-GAAP) (3) $ 152 $ 132 $ 151 $ 135
Total production costs per
ton milled (Non-GAAP) (3) $ 217 $ 178 $ 217 $ 180
Stillwater Mining Company
Key Factors (continued)
(Unaudited)
Three months ended Six months ended
OPERATING AND COST DATA June 30, June 30,
FOR MINE PRODUCTION ------------------------- -------------------------
(Continued) 2005 2004 2005 2004
- ---------------------------------------- ----------- ----------- ----------- -----------
East Boulder Mine:
Ounces produced (000)
Palladium 31 30 62 63
Platinum 9 9 17 18
Total 40 39 79 81
Tons milled (000) 118 116 235 235
Mill head grade (ounce per ton) 0.38 0.38 0.38 0.39
Sub-grade tons milled (000) (1) -- -- -- --
Sub-grade tons mill head
grade (ounce per ton) -- -- -- --
Total tons milled (000) (1) 118 116 235 235
Combined mill head
grade (ounce per ton) 0.38 0.38 0.38 0.39
Total mill recovery (%) 89 88 89 89
Total operating
costs (000) (Non-GAAP) (2) $ 11,949 $ 11,166 $ 23,970 $ 22,091
Total cash
costs (000) (Non-GAAP) (2) $ 13,970 $ 12,869 $ 28,127 $ 25,930
Total production
costs (000) (Non-GAAP) (2) $ 20,810 $ 18,721 $ 41,803 $ 37,671
Total operating costs
per ounce (Non-GAAP) (3) $ 301 $ 289 $ 303 $ 271
Total cash costs per
ounce (Non-GAAP) (3) $ 352 $ 333 $ 356 $ 318
Total production costs per
ounce (Non-GAAP) (3) $ 524 $ 484 $ 529 $ 463
Total operating costs per
ton milled (Non-GAAP) (3) $ 101 $ 96 $ 102 $ 94
Total cash costs per ton
milled (Non-GAAP) (3) $ 119 $ 111 $ 120 $ 110
Total production costs per
ton milled (Non-GAAP) (3) $ 177 $ 162 $ 178 $ 160
(1) Sub-grade tons milled includes reef waste material only. Total tons milled
includes ore tons and sub-grade tons only.
(2) Total operating costs include costs of mining, processing and
administrative expenses at the mine site (including mine site overhead and
credits for metals produced other than palladium and platinum from mine
production). Total cash costs include total operating costs plus royalties,
insurance and taxes other than income taxes. Total production costs include
total cash costs plus asset retirement costs and depreciation and
amortization. Income taxes, corporate general and administrative expenses,
asset impairment writedowns, gain or loss on disposal of property, plant
and equipment, restructuring costs, and interest income and expense are not
included in total operating costs, total cash costs or total production
costs. These measures of cost are not defined under U.S. Generally Accepted
Accounting Principles (GAAP). Please see "Reconciliation of Non-GAAP
Measures to Cost of Revenues" below for additional detail.
(3) Operating costs per ton, operating costs per ounce, cash costs per ton,
cash costs per ounce, production costs per ton and production costs per
ounce are non-GAAP measurements that management uses to monitor and
evaluate the efficiency of its mining operations. Please see
"Reconciliation of Non-GAAP Measures to Cost of Revenues" below and the
accompanying discussion.
Stillwater Mining Company
Key Factors (continued)
(Unaudited)
Three months ended Six months ended
June 30, June 30,
------------------------- -------------------------
SALES AND PRICE DATA 2005 2004 2005 2004
- ---------------------------------------- ----------- ----------- ----------- -----------
Ounces sold (000)
Mine Production:
Palladium 121 70 229 188
Platinum 40 20 71 52
Total 161 90 300 240
Other PGM activities:
Palladium 121 118 241 171
Platinum 14 10 39 27
Rhodium 9 2 22 5
Total 144 130 302 203
Total ounces sold 305 220 602 443
Average realized price
per ounce (4)
Mine Production:
Palladium $ 355 $ 386 $ 355 $ 380
Platinum $ 832 $ 859 $ 827 $ 861
Combined $ 472 $ 490 $ 466 $ 485
Other PGM activities:
Palladium $ 189 $ 253 $ 188 $ 254
Platinum $ 865 $ 833 $ 857 $ 783
Rhodium $ 1,588 $ 796 $ 1,523 $ 785
Average market price
per ounce (4)
Palladium $ 192 $ 256 $ 190 $ 249
Platinum $ 871 $ 832 $ 867 $ 850
Combined $ 359 $ 382 $ 350 $ 380
(4) The Company's average realized price represents revenues, including the
effect of contractual floor and ceiling prices, hedging gains and losses
realized on commodity instruments, and contract discounts, all divided by
total ounces sold. Prior period amounts have been adjusted to conform to
the current period presentation. The average market price represents the
average monthly London PM Fix for palladium, platinum and combined prices
and Johnson Matthey quotation for rhodium prices for the actual months of
the period.
Reconciliation of Non-GAAP Measures to Cost of Revenues
The Company utilizes certain non-GAAP measures as indicators in assessing
the performance of its mining and processing operations during any period.
Because of the processing time required to complete the extraction of finished
PGM products, there are typically lags of one to three months between ore
production and sale of the finished product. Sales in any period include some
portion of material mined and processed from prior periods as the revenue
recognition process is completed. Consequently, while cost of revenues (a GAAP
measure included in the Company's Consolidated Statement of Operations and
Comprehensive Income/(Loss)) appropriately reflects the expense associated with
the materials sold in any period, the Company has developed certain non- GAAP
measures to assess the costs associated with its producing and processing
activities in a particular period and to compare those costs between periods.
While the Company believes that these non-GAAP measures may also be of value
to outside readers, both as general indicators of the Company's mining
efficiency from period to period and as insight into how the Company internally
measures its operating performance, these non-GAAP measures are not standardized
across the mining industry and in most cases will not be directly comparable to
similar measures that may be provided by other companies. These non-GAAP
measures are only useful as indicators of relative operational performance in
any period, and because they do not take into account the inventory timing
differences that are included in cost of revenues, they cannot meaningfully be
used to develop measures of earnings or profitability. A reconciliation of these
measures to cost of revenues for each period shown is provided as part of the
following tables, and a description of each non- GAAP measure is provided below.
Total Cost of Revenues: For the Company on a consolidated basis, this
measure is equal to consolidated cost of revenues, as reported in the
Consolidated Statement of Operations and Comprehensive Income (Loss). For the
Stillwater Mine, East Boulder Mine, and other PGM activities, the Company
segregates the expenses within cost of revenues that are directly associated
with each of these activities and then allocates the remaining facility costs
included in consolidated cost of revenues in proportion to the monthly volumes
from each activity. The resulting total cost of revenues measures for Stillwater
Mine, East Boulder Mine and other PGM activities are equal in total to
consolidated cost of revenues as reported in the Company's Consolidated
Statement of Operations and Comprehensive Income (Loss).
Total Production Costs (Non-GAAP): Calculated as total cost of revenues (for
each mine or consolidated) adjusted to exclude gains or losses on asset
dispositions, costs and profit from PGM recycling activities, and timing
differences resulting from changes in product inventories. This non-GAAP measure
provides a comparative measure of the total costs incurred in association with
production and processing activities in a period, and may be compared to prior
periods or between the Company's mines.
When divided by the total tons milled in the respective period, Total
Production Cost per Ton Milled (Non-GAAP) -- measured for each mine or
consolidated -- provides an indication of the cost per ton milled in that
period. Because of variability of ore grade in the Company's mining operations,
production efficiency underground is frequently measured against ore tons
produced rather than contained PGM ounces. And because ore tons are first
actually weighed as they are fed into the mill, mill feed is the first point at
which production tons are measured precisely. Consequently, Total Production
Cost per Ton Milled (Non-GAAP) is a general measure of production efficiency,
and is affected both by the level of Total Production Costs (Non-GAAP) and by
the volume of tons produced and fed to the mill.
When divided by the total recoverable PGM ounces from production in the
respective period, Total Production Cost per Ounce (Non-GAAP) -- measured for
each mine or consolidated -- provides an indication of the cost per ounce
produced in that period. Recoverable PGM ounces from production are an
indication of the amount of PGM product extracted through mining in any period.
Because extracting PGM material is ultimately the objective of mining, the cost
per ounce of extracting and processing PGM ounces in a period is a useful
measure for comparing extraction efficiency between periods and between the
Company's mines. Consequently, Total Production Cost per Ounce (Non-GAAP) in any
period is a general measure of extraction efficiency, and is affected by the
level of Total Production Costs (Non-GAAP), by the grade of the ore produced and
by the volume of ore produced in the period.
Total Cash Costs (Non-GAAP): This non-GAAP measure is calculated by
excluding the depreciation and amortization and asset retirement costs from
Total Production Costs (Non-GAAP) for each mine or consolidated. The Company
uses this measure as a comparative indication of the cash costs related to
production and processing in any period.
When divided by the total tons milled in the respective period, Total Cash
Cost per Ton Milled (Non-GAAP) -- measured for each mine or consolidated --
provides an indication of the level of cash costs incurred per ton milled in
that period. Because of variability of ore grade in the Company's mining
operations, production efficiency underground is frequently measured against ore
tons produced rather than contained PGM ounces. And because ore tons are first
weighed as they are fed into the mill, mill feed is the first point at which
production tons are measured precisely. Consequently, Total Cash Cost per Ton
Milled (Non-GAAP) is a general measure of production efficiency, and is affected
both by the level of Total Cash Costs (Non-GAAP) and by the volume of tons
produced and fed to the mill.
When divided by the total recoverable PGM ounces from production in the
respective period, Total Cash Cost per Ounce (Non-GAAP) -- measured for each
mine or consolidated -- provides an indication of the level of cash costs
incurred per PGM ounce produced in that period. Recoverable PGM ounces from
production are an indication of the amount of PGM product extracted through
mining in any period. Because ultimately extracting PGM material is the
objective of mining, the cost per ounce of extracting and processing PGM ounces
in a period is a useful measure for comparing extraction efficiency between
periods and between the Company's mines. Consequently, Total Cash Cost per Ounce
(Non-GAAP) in any period is a general measure of extraction efficiency, and is
affected by the level of Total Cash Costs (Non-GAAP), by the grade of the ore
produced and by the volume of ore produced in the period.
Total Operating Costs (Non-GAAP): This non-GAAP measure is derived from
Total Cash Costs (Non-GAAP) for each mine or consolidated by excluding royalty,
tax, and insurance expenses from Total Cash Costs (Non-GAAP). Royalties, taxes,
and insurance costs are contractual or governmental obligations outside of the
control of the Company's mining operations, and in the case of royalties and
most taxes, are driven more by the level of sales realizations rather than by
operating efficiency. Consequently, Total Operating Costs (Non-GAAP) is a useful
indicator of the level of production and processing costs incurred in a period
that are under the control of mining operations.
When divided by the total tons milled in the respective period, Total
Operating Cost per Ton Milled (Non-GAAP) -- measured for each mine or
consolidated -- provides an indication of the level of controllable cash costs
incurred per ton milled in that period. Because of variability of ore grade in
the Company's mining operations, production efficiency underground is frequently
measured against ore tons produced rather than contained PGM ounces. And because
ore tons are first actually weighed as they are fed into the mill, mill feed is
the first point at which production tons are measured precisely. Consequently,
Total Operating Cost per Ton Milled (Non-GAAP) is a general measure of
production efficiency, and is affected both by the level of Total Operating
Costs (Non-GAAP) and by the volume of tons produced and fed to the mill.
When divided by the total recoverable PGM ounces from production in the
respective period, Total Operating Cost per Ounce (Non-GAAP) -- measured for
each mine or consolidated -- provides an indication of the level of controllable
cash costs incurred per PGM ounce produced in that period. Recoverable PGM
ounces from production are an indication of the amount of PGM product extracted
through mining in any period. Because ultimately extracting PGM material is the
objective of mining, the cost per ounce of extracting and processing PGM ounces
in a period is a useful measure for comparing extraction efficiency between
periods and between the Company's mines. Consequently, Total Operating Cost per
Ounce (Non-GAAP) in any period is a general measure of extraction efficiency,
and is affected by the level of Total Operating Costs (Non-GAAP), by the grade
of the ore produced and by the volume of ore produced in the period.
Reconciliation of Non-GAAP Measures to Cost of Revenues
Three months ended Six months ended
June 30, June 30,
------------------------- -------------------------
(in thousands) 2005 2004 2005 2004
- ---------------------------------------- ----------- ----------- ----------- -----------
Consolidated:
Reconciliation to consolidated
cost of revenues:
Total operating
costs (Non-GAAP) $ 38,022 $ 33,805 $ 76,814 $ 69,401
Royalties, taxes and other 6,539 5,125 13,184 11,647
Total cash costs
(Non-GAAP) $ 44,561 $ 38,930 $ 89,998 $ 81,048
Asset retirement costs 148 93 230 182
Depreciation and amortization 19,895 14,910 40,741 29,907
Total production costs
(Non-GAAP) $ 64,604 $ 53,933 $ 130,969 $ 111,137
Change in product inventory 37,720 (2,460) 67,830 9,589
Costs of PGM recycling 15,857 10,775 39,321 26,144
PGM recycling depreciation 14 12 27 23
Add: Profit from PGM recycling 1,203 1,513 3,103 2,478
(Gain) or loss on sale of
assets and other costs (19) -- 12 (74)
Total consolidated cost
of revenues $ 119,379 $ 63,773 $ 241,262 $ 149,297
Stillwater Mine:
Reconciliation to cost
of revenues:
Total operating costs
(Non-GAAP) $ 26,073 $ 22,639 $ 52,844 $ 47,310
Royalties, taxes and other 4,518 3,422 9,027 7,808
Total cash costs
(Non-GAAP) $ 30,591 $ 26,061 $ 61,871 $ 55,118
Asset retirement costs 107 76 149 149
Depreciation and amortization 13,096 9,075 27,146 18,199
Total production costs
(Non-GAAP) $ 43,794 $ 35,212 $ 89,166 $ 73,466
Change in product inventory 8,210 (11,439) 3,048 (9,302)
Add: Profit from PGM recycling 861 1,112 2,243 1,798
(Gain) or loss on sale of
assets and other costs (19) -- (10) (2)
Total cost of revenues $ 52,846 $ 24,885 $ 94,447 $ 65,960
East Boulder Mine:
Reconciliation to cost
of revenues:
Total operating costs
(Non-GAAP) $ 11,949 $ 11,166 $ 23,970 $ 22,091
Royalties, taxes and other 2,021 1,703 4,157 3,839
Total cash costs
(Non-GAAP) $ 13,970 $ 12,869 $ 28,127 $ 25,930
Asset retirement costs 41 17 81 33
Depreciation and amortization 6,799 5,835 13,595 11,708
Total production costs
(Non-GAAP) $ 20,810 $ 18,721 $ 41,803 $ 37,671
Change in product inventory (872) (9,593) (844) (7,533)
Add: Profit from PGM recycling 342 401 859 680
(Gain) or loss on sale of
assets and other costs -- -- 22 (72)
Total cost of revenues $ 20,280 $ 9,529 $ 41,840 $ 30,746
Other PGM activities:
Reconciliation to cost of
revenues:
Change in product inventory $ 30,382 $ 18,572 $ 65,627 $ 26,424
PGM recycling depreciation 14 12 27 23
Costs of PGM recycling 15,857 10,775 39,321 26,144
Total cost of revenues $ 46,253 $ 29,359 $ 104,975 $ 52,591
Stillwater Mining Company
Consolidated Statements of Operations and Comprehensive Income (Loss)
(Unaudited)
Three months ended Six months ended
June 30, June 30,
------------------------- -------------------------
(in thousands, except per share amounts) 2005 2004 2005 2004
- ---------------------------------------- ----------- ----------- ----------- -----------
Revenues:
Mine production $ 75,845 $ 44,345 $ 140,034 $ 116,647
PGM Recycling 16,849 12,026 41,958 28,186
Sales of palladium received
in the Norilsk Nickel
transaction and other 32,716 27,836 70,821 40,067
Total revenues 125,410 84,207 252,813 184,900
Costs and expenses:
Cost of metals sold:
Mine production 53,231 19,504 95,546 66,799
PGM Recycling 15,857 10,775 39,321 26,144
Sales of palladium
received in Norilsk
Nickel transaction
and other 30,382 18,572 65,627 26,424
Total cost of metals
sold 99,470 48,851 200,494 119,367
Depreciation and amortization:
Mine production 19,895 14,910 40,741 29,907
PGM Recycling 14 12 27 23
Total depreciation
and amortization 19,909 14,922 40,768 29,930
Total costs of
revenues 119,379 63,773 241,262 149,297
General and administrative 4,948 3,926 9,888 7,649
Total costs and
expenses 124,327 67,699 251,150 156,946
Operating income 1,083 16,508 1,663 27,954
Other income (expense)
Interest income 1,178 386 2,192 671
Interest expense (2,876) (3,360) (5,678) (7,261)
Income (loss) before income
taxes and cumulative effect
of change in accounting (615) 13,534 (1,823) 21,364
Income tax provision -- -- (3) --
Income (loss) before cumulative
effect of change in accounting (615) 13,534 (1,826) 21,364
Cumulative effect of change
in accounting -- -- -- 6,035
Net income (loss) $ (615) $ 13,534 $ (1,826) $ 27,399
Other comprehensive
income (loss) (2,218) 3,397 (1,957) 2,914
Comprehensive income (loss) $ (2,833) $ 16,931 $ (3,783) $ 30,313
Stillwater Mining Company
Consolidated Statements of Operations and Comprehensive Income (Loss)
(Unaudited)
Three months ended Six months ended
June 30, June 30,
(in thousands, except per share amounts) ------------------------- -------------------------
(Continued) 2005 2004 2005 2004
- ---------------------------------------- ----------- ----------- ----------- -----------
BASIC AND DILUTED EARNINGS
(LOSS) PER SHARE
Income (loss) before
cumulative effect of
change in accounting $ (615) $ 13,534 $ (1,826) $ 21,364
Cumulative effect of change
in accounting -- -- -- 6,035
Net income (loss) $ (615) $ 13,534 $ (1,826) $ 27,399
Weighted average common shares
outstanding
Basic 90,608 90,146 90,550 90,022
Diluted 90,608 90,541 90,550 90,293
Basic earnings (loss) per share
Income (loss) before
cumulative effect of
change in accounting $ (0.01) $ 0.15 $ (0.02) $ 0.23
Cumulative effect of
change in accounting -- -- -- 0.07
Net income (loss) $ (0.01) $ 0.15 $ (0.02) $ 0.30
Diluted earnings (loss)
per share
Income (loss) before
cumulative effect of
change in accounting $ (0.01) $ 0.15 $ (0.02) $ 0.23
Cumulative effect of
change in accounting -- -- -- 0.07
Net income (loss) $ (0.01) $ 0.15 $ (0.02) $ 0.30
Stillwater Mining Company
Consolidated Balance Sheets
(Unaudited)
(in thousands, except share and June 30, December 31,
per share amounts) 2005 2004
- ------------------------------------------- ------------ ------------
ASSETS
Current assets
Cash and cash equivalents $ 141,316 $ 96,052
Restricted cash 2,685 2,650
Investments -- 13,150
Inventories 116,924 159,942
Accounts receivable 23,005 18,186
Deferred income taxes 3,801 6,247
Other current assets 11,685 7,428
Total current assets 299,416 303,655
Property, plant and equipment, net 434,147 434,924
Other noncurrent assets 5,800 6,139
Total assets $ 739,363 $ 744,718
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 14,537 $ 15,029
Accrued payroll and benefits 15,700 13,395
Property, production and
franchise taxes payable 5,863 9,183
Current portion of long-term debt
and capital lease obligations 1,940 1,986
Portion of debt repayable upon
liquidation of finished palladium
in inventory 18,916 19,076
Fair value of derivative instruments 6,922 4,965
Other current liabilities 4,651 3,604
Total current liabilities 68,529 67,238
Long-term debt and capital lease
obligations 135,303 143,028
Deferred income taxes 3,801 6,247
Other noncurrent liabilities 19,401 15,476
Total liabilities 227,034 231,989
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.01 par value,
1,000,000 shares authorized; none issued -- --
Common stock, $0.01 par value,
200,000,000 shares authorized;
90,705,229 and 90,433,665 shares
issued and outstanding 907 904
Paid-in capital 608,428 604,177
Accumulated deficit (85,743) (83,918)
Accumulated other comprehensive loss (6,922) (4,965)
Unearned compensation - restricted stock
awards (4,341) (3,469)
Total stockholders' equity 512,329 512,729
Total liabilities and
stockholders' equity $ 739,363 $ 744,718
Stillwater Mining Company
Consolidated Statements of Cash Flows
(Unaudited)
Three months ended Six months ended
June 30, June 30,
------------------------- -------------------------
(in thousands) 2005 2004 2005 2004
- ---------------------------------------- ----------- ----------- ----------- -----------
Cash flows from operating
activities
Net income (loss) $ (615) $ 13,534 $ (1,826) $ 27,399
Adjustments to reconcile
net income (loss) to
net cash provided by operating
activities:
Depreciation and
amortization 19,909 14,922 40,768 29,930
Cumulative effect of
change in accounting -- -- -- (6,035)
Stock issued under
employee benefit plans 1,191 1,038 2,318 2,096
Amortization of debt
issuance costs 159 286 319 566
Share-based compensation 666 274 1,055 274
Changes in operating assets
and liabilities:
Inventories 21,606 (11,112) 43,018 882
Accounts receivable (3,819) 8,585 (4,819) (14,014)
Accounts payable 9 1,504 (492) 1,312
Other (4,167) (4,448) (73) (2,727)
Net cash provided by operating
activities 34,939 24,583 80,268 39,683
Cash flows from investing
activities
Capital expenditures (22,755) (20,317) (40,222) (34,892)
Purchases of investments (6,440) (4,250) (22,671) (11,000)
Proceeds from sale of
investments 24,670 1,000 35,821 8,200
Net cash used in investing
activities (4,525) (23,567) (27,072) (37,692)
Cash flows from financing
activities
Payments on long-term
debt and capital lease
obligations (7,488) (517) (7,941) (965)
Issuance of common stock,
net of stock issue costs 1 2,428 9 2,471
Net cash provided by (used in)
financing activities (7,487) 1,911 (7,932) 1,506
Cash and cash equivalents
Net increase 22,927 2,927 45,264 3,497
Balance at beginning
of period 118,389 36,231 96,052 35,661
Balance at end of period $ 141,316 $ 39,158 $ 141,316 $ 39,158
CONTACT: John W. Pearson of Stillwater Mining Company, +1-406-373-8742/
Web site: http://www.stillwatermining.com /