McEwen Mining Inc. (NYSE: MUX) (TSX: MUX) today
reported its fourth quarter (“Q4”) and full year 2023 financial and
operational results.
Net income for the year was $54.7
million or $1.15 per share versus a 2022 net loss of $81.1 million
or $1.71 per share! Gold production at the Fox Complex and
Gold Bar mine came in just above the low end of guidance and San
José just below guidance. However, cash costs(1) and AISC(1) per
ounce remain 12-18% higher than guided and need more attention.
Growth Plans for 2024
“Our biggest single asset with the
greatest near-term potential to increase our share value is our 48%
owned subsidiary McEwen Copper. Its 2nd
and 3rd largest
shareholders are global giants, Rio Tinto and Stellantis, the
world’s 2nd largest mining
company and the world’s 4th
largest automaker, owning 14.5% and 19.4% of McEwen Copper,
respectively. McEwen Copper is driving hard, with 22 drills
operating on site, to complete the necessary work to deliver a
bankable Feasibility Study in Q1 2025.
“Compared to conventional copper mines,
Los Azules is designed with a much lighter impact on the
environment, initially emitting one third (1/3) of the
CO2-e emissions and progressing
to net-zero carbon by 2038, utilizing one quarter (1/4)
the water, powered by 100% renewable
electricity, and producing sustainable copper cathode.
“At our Canadian and Mexican mines we
are advancing two important development
projects. At the
Fox Complex, the construction of the underground ramp
access to the Stock orebodies will start in Q1. The Stock West
deposit will become the primary source of production following the
completion of mining at the Froome deposit in 2026. At the Fenix
project, construction is expected to start in H2.
Both of these projects are designed to extend the mine
lives by over 9 years,” said Rob McEwen, Chairman and
Chief Owner.
Individual Mine Performance and Growth
(see Table 1 and 2)
Fox Complex, Timmins, Canada
Fox performed well in 2023, achieving its annual
production guidance. Mill throughput achieved a record average of
1,300 tonnes per day in Q4, the highest since our acquisition in
2017. As a result, mill throughput in Q4 was 36% higher than in Q4
2022. This is an important achievement by our team in Canada, as we
aim to continue to increase mining productivity and mill throughput
capacity during 2024 in preparation for production from our Stock
West project. While we work to develop our ramp access to Stock
West in 2024, with completion expected by the end of 2025, we also
intend to conduct exploration activities at Stock East and Stock
Main. We see operational improvements and cost savings at Stock as
compared to Froome due to the close proximity of the Stock Mill
(expected savings of $7 per tonne), softer material enabling higher
mill throughput, and deposits which are not encumbered by a
meaningful royalty or a stream (Froome’s 2023 stream cost estimated
at $108 per ounce produced). Exploration activities are also
underway with our Grey Fox project where we see significant
long-term growth potential. In 2023, cash costs(1) of $1,157 per
GEO sold were higher than our annual guidance of $1,020 per GEO
sold due to moving to contractor crushing in early 2023, however
AISC(1) of $1,351 per GEO sold came in below guidance of $1,465 per
GEO sold, as a result of reduced sustaining capital expenditure
requirements enabled by the productivity improvements achieved by
contractor crushing.
Gold Bar, Nevada, USA
Despite weather conditions in early 2023 that
led to flooding and a slowdown of production at Gold
Bar, our team ramped up gold production
significantly through Q4, as planned, and achieved its annual
production guidance. Cash costs(1) of $1,565 per GEO sold and
AISC(1) of $1,891 per GEO sold were 12% and 13% higher than annual
guidance of $1,400 and $1,680 per GEO sold, respectively, but
improved compared to 2022 as a result of mine contractor and
crushing crew productivity, as well as the expansion of our heap
leach pad, which was completed on time and on budget. Our Q4 unit
costs were significantly below annual guidance at cash costs(1) of
$1,253 and AISC(1) of $1,467, and we expect similar trends during
H1 2024.
San José, Santa Cruz,
Argentina(4)
San José had a difficult start to 2023 as seen
in our Q1 results. The team at San José was quick to respond by
implementing operational changes that resulted in consistent
quarterly improvements to production and unit costs. This was
achieved through mining and processing more tonnes containing
higher average gold and silver grades compared to Q1. As a result,
San José achieved annual production of 65,800 GEOs(2) in 2023,
slightly under the production guidance range of 66,000 to 74,000
GEOs(2). Annual cash costs(1) of $1,413 per GEO sold and AISC(1) of
$1,840 per GEO sold remained 12% and 18% higher than guidance of
$1,250 and $1,550 per GEO sold, respectively, as a result of lower
than expected metal grades. By Q4, cash costs(1) of $1,228 per GEO
sold and AISC(1) of $1,573 per GEO sold were achieved, which was in
line with annual guidance. With the investment in improving the
mine plan in mid-2023 and recent exploration results indicating
better than expected grades on portions of 2024 production targets,
we expect operations to continue to improve. Early 2024 production
and financial results have exceeded expectations to date.
Table 1: Comparative production
and cost per oz results for Q4 and full year 2023 and 2022, and
2023 guidance:
|
|
Q4 |
Full year |
Full Year 2023Guidance Range |
|
2022 |
2023 |
2022 |
2023 |
|
Consolidated Production |
|
|
|
|
|
|
Gold (oz) |
|
28,970 |
|
42,400 |
|
102,680 |
|
128,650 |
123,000-139,000 |
| Silver (oz) |
|
702,000 |
|
635,650 |
|
2,598,230 |
|
2,166,850 |
2,300,000-2,600,000 |
|
GEOs(2) |
|
37,280 |
|
49,850 |
|
133,300 |
|
154,600 |
150,000-170,000 |
|
Gold Bar Mine, Nevada |
|
|
|
|
|
| GEOs(2) |
|
7,940 |
|
19,800 |
|
26,620 |
|
43,700 |
42,000-48,000 |
| Cash Costs/GEO(1) |
|
1,083 |
|
1,345 |
|
1,622 |
|
1,565 |
$1,400 |
|
AISC/GEO(1) |
|
1,395 |
|
1,506 |
|
1,989 |
|
1,891 |
$1,680 |
|
Fox Complex, Canada |
|
|
|
|
|
| GEOs(2) |
|
9,870 |
|
10,200 |
|
36,650 |
|
44,450 |
42,000-48,000 |
| Cash Costs/GEO(1) |
|
1,137 |
|
1,253 |
|
1,020 |
|
1,157 |
$1,000 |
|
AISC/GEO(1) |
|
1,606 |
|
1,467 |
|
1,465 |
|
1,351 |
$1,320 |
|
San José Mine, Argentina (49%)(4) |
|
|
|
|
|
| Gold production (oz) |
|
11,170 |
|
11,700 |
|
38,610 |
|
39,700 |
39,000-43,000 |
| Silver production (oz) |
|
700,850 |
|
635,650 |
|
2,593,300 |
|
2,166,850 |
2,300,000-2,600,000 |
| GEOs(2) |
|
19,420 |
|
19,150 |
|
69,130 |
|
65,650 |
66,000-74,000 |
| Cash Costs/GEO(1) |
$1,321 |
$1,228 |
$1,306 |
$1,413 |
$1,250 |
|
AISC/GEO(1) |
$1,701 |
$1,573 |
$1,714 |
$1,840 |
$1,550 |
Table 2: 2024 Production & Costs per
GEO Guidance
|
|
2024 Guidance |
|
100% Owned Mines (Gold Bar and Fox) |
|
|
GEOs(2) |
80,000-85,000 |
| Cash
Costs/GEO(1) |
$1,350-1,450 |
|
AISC/GEO(1) |
$1,550-1,650 |
|
Gold Bar Mine, Nevada |
|
|
GEOs(2) |
40,000-43,000 |
| Cash
Costs/GEO(1) |
$1,450-1,550 |
|
AISC/GEO(1) |
$1,650-1,750 |
|
Fox Complex, Canada |
|
|
GEOs(2) |
40,000-42,000 |
| Cash
Costs/GEO(1) |
$1,225-1,325 |
|
AISC/GEO(1) |
$1,450-1,550 |
|
San José Mine, Argentina (49%) |
|
|
GEOs(2) |
50,000-60,000 |
| Cash
Costs/GEO(1) |
$1,300-1,500 |
|
AISC/GEO(1) |
$1,500-1,700 |
Advances in Q4 2023
- McEwen Copper:
Financings with Stellantis and Nuton (Rio Tinto) were closed in Q4,
raising ARS $42 billion and $10.0
million, respectively, at a value of
$26.00 per share, implying a market value of
$800 million for McEwen Copper. Concurrently
with these transactions, McEwen Mining sold 232,000 common shares
of McEwen Copper in return for $6.0 million. After
the closing of these transactions, Stellantis and Nuton own 19.4%
and 14.5%, respectively, of McEwen Copper, while the Company’s
ownership decreased to 47.7%.
- Safety at all of
our operations was excellent with no lost-time incidents.
- Gold Bar: During
Q4, we achieved new daily, monthly, and quarterly production
records as a result of the improvements in mining productivity, the
addition of crushing crews and the completion of the heap leach pad
expansion.
- Fox Complex: We
achieved the highest average daily mill throughput on record since
acquisition in 2017, reaching 1,300 tonnes per day during Q4, and
are currently reviewing improvements in 2024 to mining productivity
and processing flowsheets to continue to increase throughput
levels.
- In December, the
Company completed a private placement offering of 1,903,000
flow-through common shares for gross proceeds of $16.1
million (CAD $22.0 million) to be used exclusively to
support exploration and development work at the Fox Complex, which
includes the development of the Stock ramp.
- We continue to
invest heavily in exploration and the results have been most
encouraging, particularly at Los Azules, where the resource
base increased by 27%, and at the Fox Complex, where the results
allow us to see the potential for significant increase in mine life
at Stock and Grey Fox.
Financial Results
McEwen Mining ceased being the majority
owner of McEwen Copper after the October 2023 financing (moving
from 51.9% to 47.7% ownership), therefore for the fourth quarter
and moving forward the Company’s financial statements no longer
consolidates McEwen Copper on a 100% basis, and instead accounts
for McEwen Copper as an equity investment. As a result of the
deconsolidation of McEwen Copper, we recognized a gain of $224
million and an investment value of $384 million based on the value
per share achieved in our October financing.
Notice to reader: Under US GAAP, McEwen Mining
consolidates 100% of the accounts of its fully owned and majority
owned subsidiaries in its reported financial results. Entities over
which we exert significant influence but do not control (such as
Minera Santa Cruz S.A. (“MSC”), the operator of the San José mine,
and McEwen Copper, the owner of the Los Azules copper project) are
presented as equity investments on our balance sheet.
Net income for full year 2023 was $54.7
million, or $1.15 per share, compared to
net loss of $81.1 million, or $1.71 per share for full year 2022.
Our net income for full year 2023 improved primarily as a result of
the $224.0 million accounting gain recognized on the
deconsolidation of McEwen Copper. Net income for Q4 was
$137.9 million, or $2.88 per
share, compared with a net loss of $37.4 million, or $0.79 per
share for Q4 2022.
Liquidity and Capital
Resources
We reported consolidated cash and cash
equivalents of $23.0 million and consolidated
working capital of $22.7 million as at
December 31, 2023, compared to the respective numbers at December
31, 2022, of $39.8 million and negative $2.5 million. The reported
consolidated cash balance at December 31, 2023 does not include
cash balances held by McEwen Copper given the deconsolidation
recognized in Q4 2023; while our cash and cash equivalents balance
of $39.8 million included $38.1 million attributable to McEwen
Copper.
During 2023, we decreased our total debt by
$25 million or 38% to $40 million
and entered into the Third Amended and Restated Credit Agreement
effective May 23, 2023.
The Company also holds a portfolio of royalties
including a 1.25% net smelter royalty at both our Los Azules and
Elder Creek properties, together with other royalties on
properties in Nevada, Yukon, Canada and in Santa Cruz,
Argentina.
Exploration
Exploration results from the Stock deposits at
the Fox Complex were published in a separate press
release on February 28th. Highlights include a 31% increase in gold
resources compared to 2022. Drilling in the Stock East deposit area
returned high grade intersections up to 121.5 grams per tonne (3.91
oz/t) in an orientation that suggests that earlier drilling may
have missed other possible high-grade occurrences.
Gold Bar exploration activities
are currently focused on discovering near mine resources.
Additional drilling targets have been identified at our Pick and
Cabin pits to expand upon results from our 2023 drilling.
McEwen Copper
New metallurgical and exploration results from
Los Azules were published in news releases dated
February 22nd and 26th. Metallurgical highlights include a 76%
expected average copper recovery (3.2% higher compared to the 2023
NI 43-101 Preliminary Economic Assessment (“PEA”)) during the
27-year life of mine and 8.3% lower acid consumption, resulting in
a potential increase in the project after-tax NPV(8%) of
$262 million(3). Exploration highlights included
446 m of 0.76% including 76 m of 0.92% (hole AZ23228MET). Our
2023-2024 drilling season began in October 2023; during Q4 we
completed over 74,000 feet (22,627 meters) of drilling out of a
full season target of 203,000 feet (62,000 meters). A full
complement of 22 drill rigs is operating on site to reach this
target.
Confirmatory metallurgical testing and a large
drilling campaign to upgrade resources, as well as geotechnical,
hydrological, and geohydrological works are well underway to
support the delivery of the feasibility study by early 2025.
We own a 47.7% interest in McEwen Copper Inc.,
which holds a 100% interest in the Los Azules copper project in San
Juan, Argentina, and the Elder Creek exploration project in Nevada,
USA. The last financings completed by McEwen Copper with Stellantis
and Nuton (Rio Tinto) gave the Company a market value of $800
million. This translates to $384 million for McEwen Mining
shareholders’ 47.7% ownership.
Management Conference Call
Management will discuss our Q4 financial results
and project developments and follow with a question-and-answer
session. Questions can be asked directly by participants over the
phone during the webcast.
|
FridayMar 1, 2024 at
10:00 AM EST |
Toll Free (US & Canada): |
(888) 210-3454 |
| Toll Free Dial-In Other
Countries: |
https://events.q4irportal.com/custom/access/2324/ |
| Toll Dial
In: |
(646) 960-0130 |
| Conference ID
Number: |
3232920 |
|
Event Registration Link: |
https://events.q4inc.com/attendee/876515509 |
An archived replay of the webcast will be
available approximately 2 hours following the conclusion of the
live event. Access the replay on the Company’s media page at
https://www.mcewenmining.com/media.
Notes:
- Cash gross profit, cash costs per
ounce, all-in sustaining costs (AISC) per ounce, adjusted net
income or loss and adjusted net income or loss per share are
non-GAAP financial performance measures with no standardized
definition under U.S. GAAP. For definition and reconciliation of
the non-GAAP measures see "Non-GAAP Financial Measures" section in
this press release and the unaudited Consolidated Balance Sheets
and Consolidated Statements of Operations and Comprehensive Income
below.
- 'Gold Equivalent Ounces' are
calculated based on a gold to silver price ratio of 85:1 for Q4
2023, 83:1 for 2023, 85:1 for Q4 2022 and 84:1 for 2022. 2023 and
2024 production guidance is calculated based on 85:1 gold to silver
price ratio.
- This disclosure should not be taken
to modify or update the conclusions of the PEA.
- Please refer to the “Reliability of
Information Regarding San José” section in this press release.
|
MCEWEN MINING INC.CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME
(LOSS)FOR THE YEARS ENDED DECEMBER
31,(unaudited, in thousands of U.S. dollars,
except per share amounts) |
| |
|
|
|
|
|
|
|
|
|
| |
|
|
2023 |
|
|
|
2022 |
|
|
|
2021 |
|
|
Revenue from gold and silver sales |
|
$ |
166,231 |
|
|
$ |
110,417 |
|
|
$ |
136,541 |
|
| Production costs applicable to
sales |
|
|
(119,230 |
) |
|
|
(91,260 |
) |
|
|
(119,223 |
) |
| Depreciation and
depletion |
|
|
(29,221 |
) |
|
|
(19,701 |
) |
|
|
(23,798 |
) |
| Gross profit (loss) |
|
|
17,780 |
|
|
|
(544 |
) |
|
|
(6,480 |
) |
| |
|
|
|
|
|
|
|
|
|
| OTHER OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
|
| Advanced projects - Los
Azules |
|
|
(80,038 |
) |
|
|
(61,148 |
) |
|
|
(5,019 |
) |
| Advanced projects - Other |
|
|
(6,292 |
) |
|
|
(5,580 |
) |
|
|
(7,420 |
) |
| Exploration |
|
|
(20,167 |
) |
|
|
(14,973 |
) |
|
|
(22,604 |
) |
| General and
administrative |
|
|
(15,449 |
) |
|
|
(11,890 |
) |
|
|
(11,435 |
) |
| Loss from investment in McEwen
Copper Inc. |
|
|
(60,084 |
) |
|
|
— |
|
|
|
— |
|
| Loss (income) from investment
in Minera Santa Cruz S.A.(4) |
|
|
(281 |
) |
|
|
2,776 |
|
|
|
(7,533 |
) |
| Depreciation |
|
|
(1,086 |
) |
|
|
(733 |
) |
|
|
(339 |
) |
| Reclamation and
remediation |
|
|
(2,693 |
) |
|
|
(3,345 |
) |
|
|
(3,450 |
) |
|
|
|
|
(186,090 |
) |
|
|
(94,893 |
) |
|
|
(57,800 |
) |
| Operating loss |
|
|
(168,310 |
) |
|
|
(95,437 |
) |
|
|
(64,280 |
) |
| |
|
|
|
|
|
|
|
|
|
| OTHER INCOME (EXPENSE): |
|
|
|
|
|
|
|
|
|
| Interest and other finance
income (expenses), net |
|
|
36,918 |
|
|
|
(7,789 |
) |
|
|
(6,200 |
) |
| Other (expense) income |
|
|
(29,925 |
) |
|
|
22,938 |
|
|
|
6,281 |
|
| Gain on deconsolidation of
McEwen Copper Inc. |
|
|
224,048 |
|
|
|
— |
|
|
|
— |
|
|
Total other income |
|
|
231,041 |
|
|
|
15,149 |
|
|
|
81 |
|
| Income (loss) before income
and mining taxes |
|
|
62,731 |
|
|
|
(80,288 |
) |
|
|
(64,199 |
) |
| Income and mining tax recovery
(expense) |
|
|
(31,873 |
) |
|
|
(5,806 |
) |
|
|
7,315 |
|
| Net income (loss) after income
and mining taxes |
|
|
62,731 |
|
|
|
(86,094 |
) |
|
|
(56,884 |
) |
| Net loss attributable to
non-controlling interests |
|
|
23,872 |
|
|
|
5,019 |
|
|
|
172 |
|
| Net income (loss) and
comprehensive income (loss) attributable to McEwen
shareholders |
|
$ |
54,730 |
|
|
$ |
(81,075 |
) |
|
$ |
(56,712 |
) |
| |
|
|
|
|
|
|
|
|
|
| Net income (loss) per
share: |
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
$ |
1.15 |
|
|
$ |
(1.71 |
) |
|
$ |
(1.25 |
) |
| Weighted average common shares
outstanding (thousands): |
|
|
|
|
|
|
|
|
|
|
Basic and diluted |
|
|
47,544 |
|
|
|
47,427 |
|
|
|
45,490 |
|
|
MCEWEN MINING INC.CONSOLIDATED BALANCE
SHEETS AS AT DECEMBER 31,(unaudited, in thousands
of U.S. dollars and shares) |
| |
|
|
|
|
| |
|
December 31, |
|
December 31, |
| |
|
2023 |
|
2022 |
| ASSETS |
|
|
|
|
|
|
| Current assets: |
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
23,020 |
|
|
$ |
39,782 |
|
|
Investments |
|
|
1,743 |
|
|
|
1,295 |
|
|
Receivables, prepaids and other current assets |
|
|
5,578 |
|
|
|
8,840 |
|
|
Due from McEwen Copper Inc. |
|
|
2,376 |
|
|
|
— |
|
|
Inventories, current portion |
|
|
19,944 |
|
|
|
31,735 |
|
| Total current assets |
|
|
52,661 |
|
|
|
81,652 |
|
|
Mineral property interests and plant and equipment, net |
|
|
170,000 |
|
|
|
346,281 |
|
|
Investment in McEwen Copper Inc. |
|
|
323,884 |
|
|
|
— |
|
|
Investment in Minera Santa Cruz S.A.(4) |
|
|
92,875 |
|
|
|
93,451 |
|
|
Inventories |
|
|
10,100 |
|
|
|
2,432 |
|
|
Restricted cash |
|
|
4,490 |
|
|
|
3,797 |
|
|
Other assets |
|
|
674 |
|
|
|
1,106 |
|
| TOTAL ASSETS |
|
$ |
654,684 |
|
|
$ |
528,719 |
|
| |
|
|
|
|
|
|
| LIABILITIES &
SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
| Current liabilities: |
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
|
$ |
22,656 |
|
|
$ |
42,521 |
|
|
Flow-through share premium |
|
|
1,661 |
|
|
|
4,056 |
|
|
Reclamation and remediation liabilities, current portion |
|
|
3,105 |
|
|
|
12,576 |
|
|
Tax liabilities |
|
|
1,603 |
|
|
|
7,663 |
|
|
Lease liabilities, current portion |
|
|
978 |
|
|
|
1,215 |
|
|
Long-term debt, current portion |
|
|
— |
|
|
|
10,000 |
|
|
Contract liability |
|
|
— |
|
|
|
6,155 |
|
| Total current liabilities |
|
|
30,003 |
|
|
|
84,186 |
|
|
Long-term debt |
|
|
40,000 |
|
|
|
53,979 |
|
|
Reclamation and remediation liabilities |
|
|
39,916 |
|
|
|
29,270 |
|
|
Deferred tax liabilities |
|
|
38,586 |
|
|
|
— |
|
|
Lease liabilities |
|
|
488 |
|
|
|
1,191 |
|
|
Other liabilities |
|
|
3,840 |
|
|
|
3,819 |
|
| Total liabilities |
|
$ |
152,833 |
|
|
$ |
172,445 |
|
| |
|
|
|
|
|
|
| Shareholders’ equity: |
|
|
|
|
|
|
|
Common shares |
|
$ |
1,768,456 |
|
|
$ |
1,644,144 |
|
|
Non-controlling interests |
|
|
— |
|
|
|
33,465 |
|
|
Accumulated deficit |
|
|
(1,266,605 |
) |
|
|
(1,321,335 |
) |
| Total shareholders’
equity |
|
|
501,851 |
|
|
|
356,274 |
|
| TOTAL LIABILITIES &
SHAREHOLDERS’ EQUITY |
|
$ |
654,684 |
|
|
$ |
528,719 |
|
|
MCEWEN MINING INC.CONSOLIDATED STATEMENTS
OF CHANGES IN SHAREHOLDERS’ EQUITYFOR THE YEARS
ENDED DECEMBER 31,(unaudited, in thousands of U.S.
dollars and shares) |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Common Shares |
|
|
|
|
|
|
|
|
| |
|
and Additional |
|
|
|
|
|
|
|
|
|
| |
|
Paid-in Capital |
|
|
Accumulated |
|
|
Non-controlling |
|
|
|
| |
|
Shares |
|
Amount |
|
|
Deficit |
|
|
Interests |
|
|
Total |
|
Balance, December 31, 2020 |
|
41,659 |
|
$ |
1,548,876 |
|
|
$ |
(1,183,548 |
) |
|
$ |
— |
|
|
$ |
365,328 |
|
| Stock-based compensation |
|
— |
|
|
837 |
|
|
|
— |
|
|
|
— |
|
|
|
837 |
|
| Sale of flow-through
shares |
|
1,260 |
|
|
10,785 |
|
|
|
— |
|
|
|
— |
|
|
|
10,785 |
|
| Sale of shares for cash |
|
3,000 |
|
|
29,875 |
|
|
|
— |
|
|
|
— |
|
|
|
29,875 |
|
| Issuance of equity by
subsidiary |
|
— |
|
|
25,051 |
|
|
|
— |
|
|
|
14,949 |
|
|
|
40,000 |
|
| Net loss and comprehensive
loss |
|
— |
|
|
— |
|
|
|
(56,712 |
) |
|
|
(172 |
) |
|
|
(56,884 |
) |
| Balance, December 31,
2021 |
|
45,919 |
|
$ |
1,615,424 |
|
|
$ |
(1,240,260 |
) |
|
$ |
14,777 |
|
|
$ |
389,941 |
|
| Stock-based compensation |
|
— |
|
|
340 |
|
|
|
— |
|
|
|
— |
|
|
|
340 |
|
| Sale of flow-through
shares |
|
1,450 |
|
|
10,320 |
|
|
|
— |
|
|
|
— |
|
|
|
10,320 |
|
| Shares issued for debt
refinancing |
|
59 |
|
|
500 |
|
|
|
— |
|
|
|
— |
|
|
|
500 |
|
| Issuance of equity by
subsidiary |
|
— |
|
|
17,643 |
|
|
|
— |
|
|
|
23,707 |
|
|
|
41,350 |
|
| Share repurchase |
|
— |
|
|
(87 |
) |
|
|
— |
|
|
|
— |
|
|
|
(87 |
) |
| Exercise of warrants |
|
— |
|
|
4 |
|
|
|
— |
|
|
|
— |
|
|
|
4 |
|
| Net loss and comprehensive
loss |
|
— |
|
|
— |
|
|
|
(81,075 |
) |
|
|
(5,019 |
) |
|
|
(86,094 |
) |
| Balance, December 31,
2022 |
|
47,428 |
|
$ |
1,644,144 |
|
|
$ |
(1,321,335 |
) |
|
$ |
33,465 |
|
|
$ |
356,274 |
|
| Stock-based compensation |
|
66 |
|
|
605 |
|
|
|
— |
|
|
|
— |
|
|
|
605 |
|
| Restricted shares issued |
|
43 |
|
|
366 |
|
|
|
— |
|
|
|
— |
|
|
|
366 |
|
| Proceeds from McEwen Copper
financing |
|
— |
|
|
109,913 |
|
|
|
— |
|
|
|
75,477 |
|
|
|
185,390 |
|
| Sale of flow-through
shares |
|
1,903 |
|
|
13,428 |
|
|
|
— |
|
|
|
— |
|
|
|
13,428 |
|
| Net income (loss) and
comprehensive income (loss) |
|
— |
|
|
— |
|
|
|
54,730 |
|
|
|
(23,872 |
) |
|
|
30,858 |
|
| McEwen Copper Inc.
deconsolidation |
|
— |
|
|
— |
|
|
|
— |
|
|
|
(85,070 |
) |
|
|
(85,070 |
) |
| Balance, December 31,
2023 |
|
49,440 |
|
$ |
1,768,456 |
|
|
$ |
(1,266,605 |
) |
|
$ |
— |
|
|
$ |
501,851 |
|
|
MCEWEN MINING INC.CONSOLIDATED
STATEMENTS OF CASH FLOWSFOR THE YEARS ENDED
DECEMBER 31,(unaudited, in thousands of U.S.
dollars) |
| |
|
|
|
|
|
|
|
|
|
| |
|
Year ended December 31, |
| |
|
|
2023 |
|
|
|
2022 |
|
|
|
2021 |
|
| Cash flows from operating
activities: |
|
|
|
|
|
|
|
|
|
|
Net income (loss) |
|
$ |
30,858 |
|
|
$ |
(86,094 |
) |
|
$ |
(56,884 |
) |
| Adjustments to reconcile net
loss from operating activities: |
|
|
|
|
|
|
|
|
|
|
Loss from investment in McEwen Copper Inc. |
|
|
60,084 |
|
|
|
— |
|
|
|
— |
|
|
Loss (income) from investment in Minera Santa
Cruz S.A.(4) |
|
|
281 |
|
|
|
(2,776 |
) |
|
|
7,533 |
|
|
Gain on sale of mineral property interests |
|
|
— |
|
|
|
— |
|
|
|
(2,271 |
) |
|
Depreciation, amortization and depletion |
|
|
30,307 |
|
|
|
19,532 |
|
|
|
25,338 |
|
|
Unrealized (gain) loss on investments |
|
|
(20,542 |
) |
|
|
511 |
|
|
|
(28 |
) |
|
Foreign exchange loss on investments |
|
|
9,858 |
|
|
|
— |
|
|
|
— |
|
|
Foreign exchange loss |
|
|
48,977 |
|
|
|
2,029 |
|
|
|
160 |
|
|
Reclamation accretion and adjustments to estimate |
|
|
2,693 |
|
|
|
7,168 |
|
|
|
3,677 |
|
|
Income and mining tax recovery |
|
|
35,033 |
|
|
|
(1,856 |
) |
|
|
(7,315 |
) |
|
Stock-based compensation |
|
|
971 |
|
|
|
340 |
|
|
|
837 |
|
|
Gain on deconsolidation of McEwen Copper Inc. |
|
|
(224,048 |
) |
|
|
— |
|
|
|
— |
|
|
Change in non-cash working capital items: |
|
|
|
|
|
|
|
|
|
|
Change in other assets related to operations |
|
|
7,113 |
|
|
|
(12,873 |
) |
|
|
7,887 |
|
|
Change in liabilities related to operations |
|
|
(24,298 |
) |
|
|
17,439 |
|
|
|
1,003 |
|
|
Cash used in operating activities |
|
$ |
(42,713 |
) |
|
$ |
(56,580 |
) |
|
$ |
(20,063 |
) |
|
|
|
|
|
|
|
|
|
|
|
| Cash flows from investing
activities: |
|
|
|
|
|
|
|
|
|
|
Additions to mineral property interests and plant and
equipment |
|
$ |
(23,021 |
) |
|
$ |
(24,187 |
) |
|
$ |
(34,888 |
) |
|
Proceeds from disposal of property and equipment |
|
|
— |
|
|
|
— |
|
|
|
492 |
|
|
Investment in marketable equity securities |
|
|
(34,157 |
) |
|
|
— |
|
|
|
— |
|
|
Dividends received from Minera Santa Cruz S.A. |
|
|
295 |
|
|
|
286 |
|
|
|
9,832 |
|
|
Cash outflow on McEwen Copper Inc. deconsolidation |
|
|
(45,708 |
) |
|
|
— |
|
|
|
— |
|
|
Cash used in investing activities |
|
$ |
(101,591 |
) |
|
$ |
(23,901 |
) |
|
$ |
(24,564 |
) |
|
|
|
|
|
|
|
|
|
|
|
| Cash flows from financing
activities: |
|
|
|
|
|
|
|
|
|
|
Proceeds from McEwen Copper Inc. financing |
|
|
185,390 |
|
|
|
41,263 |
|
|
|
29,875 |
|
|
Proceeds from sale of investment in McEwen Copper Inc. |
|
|
6,032 |
|
|
|
— |
|
|
|
— |
|
|
Issuance of flow-through common shares, net of issuance costs |
|
|
13,428 |
|
|
|
14,376 |
|
|
|
11,966 |
|
|
Proceeds from promissory note |
|
|
— |
|
|
|
15,000 |
|
|
|
40,000 |
|
|
Principal repayment on long-term debt |
|
|
(25,000 |
) |
|
|
— |
|
|
|
— |
|
|
Subscription proceeds received in advance |
|
|
— |
|
|
|
(2,850 |
) |
|
|
2,550 |
|
|
Proceeds from exercise of warrants |
|
|
— |
|
|
|
4 |
|
|
|
— |
|
|
Payment of finance lease obligations |
|
|
(1,637 |
) |
|
|
(2,338 |
) |
|
|
(3,408 |
) |
|
Cash provided by financing activities |
|
$ |
178,213 |
|
|
$ |
65,455 |
|
|
$ |
80,983 |
|
| Effect of exchange rate change
on cash and cash equivalents |
|
|
(48,977 |
) |
|
|
(2,029 |
) |
|
|
(160 |
) |
| (Decrease) increase in cash,
cash equivalents and restricted cash |
|
|
(16,068 |
) |
|
|
(17,055 |
) |
|
|
36,196 |
|
| Cash, cash equivalents and
restricted cash, beginning of year |
|
|
43,579 |
|
|
|
60,634 |
|
|
|
24,438 |
|
| Cash, cash equivalents and
restricted cash, end of year |
|
$ |
27,511 |
|
|
$ |
43,579 |
|
|
$ |
60,634 |
|
NON-GAAP FINANCIAL PERFORMANCE
MEASURES
We have included in this report certain non-GAAP
performance measures as detailed below. In the gold mining
industry, these are common performance measures but do not have any
standardized meaning and are considered non-GAAP measures. We use
these measures to evaluate our business on an ongoing basis and
believe that, in addition to conventional measures prepared in
accordance with GAAP, certain investors use such non-GAAP measures
to evaluate our performance and ability to generate cash flow. We
also report these measures to provide investors and analysts with
useful information about our underlying costs of operations and
clarity over our ability to finance operations. Accordingly, they
are intended to provide additional information and should not be
considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP. There are limitations
associated with the use of such non-GAAP measures. We compensate
for these limitations by relying primarily on our US GAAP results
and using the non-GAAP measures supplementally.
The non-GAAP measures are presented for our
wholly owned mines and our interest in the San José mine. The
amounts in the reconciliation tables labeled “49% basis” were
derived by applying to each financial statement line item the
ownership percentage interest used to arrive at our share of net
income or loss during the period when applying the equity method of
accounting. We do not control the interest in or operations of MSC
and the presentations of assets and liabilities and revenues and
expenses of MSC do not represent our legal claim to such items. The
amount of cash we receive is based upon specific provisions of the
Option and Joint Venture Agreement (“OJVA”) and varies depending on
factors including the profitability of the operations.
The presentation of these measures, including
the minority interest in the San José, has limitations as an
analytical tool. Some of these limitations include:
- The amounts
shown on the individual line items were derived by applying our
overall economic ownership interest percentage determined when
applying the equity method of accounting and do not represent our
legal claim to the assets and liabilities, or the revenues and
expenses; and
- Other companies
in our industry may calculate their cash cost per ounce and all-in
sustaining costs differently than we do, limiting the usefulness as
a comparative measure.
Cash Costs and All-In Sustaining Costs
The terms cash costs, cash cost per ounce,
all-in sustaining costs (“AISC”), and all-in sustaining cost per
ounce used in this report are non-GAAP financial measures. We
report these measures to provide additional information regarding
operational efficiencies on an individual mine basis, and believe
these measures provide investors and analysts with useful
information about our underlying costs of operations.
Cash costs consist of mining, processing,
on-site general and administrative expenses, community and
permitting costs related to current operations, royalty costs,
refining and treatment charges (for both doré and concentrate
products), sales costs, export taxes and operational stripping
costs, but exclude depreciation and amortization (non-cash items).
The sum of these costs is divided by the corresponding gold
equivalent ounces sold to determine a per ounce amount.
All-in sustaining costs consist of cash costs
(as described above), plus accretion of retirement obligations and
amortization of the asset retirement costs related to operating
sites, environmental rehabilitation costs for mines with no
reserves, sustaining exploration and development costs, sustaining
capital expenditures and sustaining lease payments. Our all-in
sustaining costs exclude the allocation of corporate general and
administrative costs. The following is additional information
regarding our all-in sustaining costs:
- Sustaining
operating costs represent expenditures incurred at current
operations that are considered necessary to maintain current annual
production at the mine site and include mine development costs and
ongoing replacement of mine equipment and other capital facilities.
Sustaining capital costs do not include costs of expanding the
project that would result in improved productivity of the existing
asset, increased existing capacity or extended useful life.
- Sustaining
exploration and development costs include expenditures incurred to
sustain current operations and to replace reserves and/or resources
extracted as part of the ongoing production. Exploration activity
performed near-mine (brownfield) or new exploration projects
(greenfield) are classified as non-sustaining.
The sum of all-in sustaining costs is divided by
the corresponding gold equivalent ounces sold to determine a per
ounce amount.
Costs excluded from cash costs and all-in
sustaining costs, in addition to depreciation and depletion, are
income and mining tax expenses, all corporate financing charges,
costs related to business combinations, asset acquisitions and
asset disposal, and any items that are deducted for the purpose of
normalizing items.
The following tables reconcile these non-GAAP
measures to the most directly comparable GAAP measure, production
costs applicable to sales. The El Gallo mine results are excluded
from this reconciliation for 2023, 2022 and 2021 as the economics
of residual leaching operations are measured by incremental revenue
exceeding incremental costs. Residual leaching costs for the year
ended December 31, 2023, were $nil million compared to $0.7 million
in 2022 and $9.3 million in 2021. As a result, we have ceased using
cash cost and all-in sustaining cost per gold equivalent ounce to
evaluate the El Gallo mine on an ongoing basis and have therefore
ceased disclosure of such metric:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, 2023 |
|
Year ended December 31, 2023 |
| |
|
Gold Bar |
|
Fox Complex |
|
Total |
|
Gold Bar |
|
Fox Complex |
|
Total |
| |
|
(in thousands, except
per ounce) |
|
(in thousands, except
per ounce) |
| Production costs
applicable to sales - Cash costs (100% owned) |
|
$ |
25,889 |
|
$ |
13,298 |
|
$ |
39,187 |
|
$ |
67,335 |
|
$ |
51,895 |
|
$ |
119,230 |
|
In‑mine exploration |
|
|
1,705 |
|
|
— |
|
|
1,705 |
|
|
4,759 |
|
|
— |
|
|
4,759 |
|
Capitalized underground mine development (sustaining) |
|
|
— |
|
|
2,119 |
|
|
2,119 |
|
|
— |
|
|
8,046 |
|
|
8,046 |
|
Capital expenditures on plant and equipment (sustaining) |
|
|
1,374 |
|
|
— |
|
|
1,374 |
|
|
9,028 |
|
|
— |
|
|
9,028 |
|
Sustaining leases |
|
|
11 |
|
|
153 |
|
|
164 |
|
|
248 |
|
|
676 |
|
|
924 |
| All‑in sustaining
costs |
|
$ |
28,979 |
|
$ |
15,570 |
|
$ |
44,549 |
|
$ |
81,370 |
|
$ |
60,617 |
|
$ |
141,987 |
| Ounces sold, including stream
(GEO) |
|
|
19.2 |
|
|
10.6 |
|
|
29.9 |
|
|
43.0 |
|
|
44.9 |
|
|
87.9 |
| Cash cost per ounce
sold ($/GEO) |
|
$ |
1,345 |
|
$ |
1,253 |
|
$ |
1,313 |
|
$ |
1,565 |
|
$ |
1,157 |
|
$ |
1,356 |
| AISC per ounce sold
($/GEO) |
|
$ |
1,506 |
|
$ |
1,467 |
|
$ |
1,492 |
|
$ |
1,891 |
|
$ |
1,351 |
|
$ |
1,615 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, 2022 |
|
Year ended December 31, 2022 |
| |
|
Gold Bar |
|
Fox Complex |
|
Total |
|
Gold Bar |
|
Fox Complex |
|
Total |
| |
|
(in thousands, except per ounce) |
|
(in thousands, except per ounce) |
| Production costs applicable to
sales - Cash costs (100% owned) |
|
$ |
8,666 |
|
$ |
10,742 |
|
$ |
19,408 |
|
$ |
43,500 |
|
$ |
36,845 |
|
$ |
80,345 |
|
Mine site reclamation, accretion and amortization |
|
|
218 |
|
|
— |
|
|
218 |
|
|
1,654 |
|
|
— |
|
|
1,654 |
|
In‑mine exploration |
|
|
505 |
|
|
— |
|
|
505 |
|
|
3,335 |
|
|
— |
|
|
3,335 |
|
Capitalized underground mine development (sustaining) |
|
|
— |
|
|
4,317 |
|
|
4,317 |
|
|
— |
|
|
15,448 |
|
|
15,448 |
|
Capital expenditures on plant and equipment (sustaining) |
|
|
1,576 |
|
|
— |
|
|
1,576 |
|
|
3,084 |
|
|
— |
|
|
3,084 |
|
Sustaining leases |
|
|
191 |
|
|
110 |
|
|
301 |
|
|
1,754 |
|
|
619 |
|
|
2,373 |
| All‑in sustaining costs |
|
$ |
11,156 |
|
$ |
15,169 |
|
$ |
26,325 |
|
$ |
53,327 |
|
$ |
52,912 |
|
$ |
106,239 |
| Ounces sold, including stream
(GEO)(1) |
|
|
8.0 |
|
|
9.4 |
|
|
17.4 |
|
|
26.8 |
|
|
36.1 |
|
|
62.9 |
| Cash cost per ounce sold
($/GEO) |
|
$ |
1,083 |
|
$ |
1,137 |
|
$ |
1,112 |
|
$ |
1,622 |
|
$ |
1,020 |
|
$ |
1,276 |
| AISC per ounce sold
($/GEO) |
|
$ |
1,395 |
|
$ |
1,606 |
|
$ |
1,509 |
|
$ |
1,989 |
|
$ |
1,465 |
|
$ |
1,688 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Three months ended December 31, |
|
Year ended December 31, |
| |
|
2023 |
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
|
2021 |
|
| San José mine cash
costs (100% basis) (4) |
|
(in thousands, except
per ounce) |
|
|
|
|
Production costs applicable to sales - Cash
costs |
|
$ |
48,680 |
|
|
$ |
51,963 |
|
|
$ |
180,115 |
|
|
$ |
182,195 |
|
|
$ |
196,032 |
|
|
Mine site reclamation, accretion and amortization |
|
|
93 |
|
|
|
111 |
|
|
|
535 |
|
|
|
400 |
|
|
|
451 |
|
|
Site exploration expenses |
|
|
1,831 |
|
|
|
2,158 |
|
|
|
9,167 |
|
|
|
8,946 |
|
|
|
11,207 |
|
|
Capitalized underground mine development (sustaining) |
|
|
10,407 |
|
|
|
10,201 |
|
|
|
38,346 |
|
|
|
37,959 |
|
|
|
27,548 |
|
|
Less: Depreciation |
|
|
(768 |
) |
|
|
(499 |
) |
|
|
(2,930 |
) |
|
|
(1,990 |
) |
|
|
(1,971 |
) |
|
Capital expenditures (sustaining) |
|
|
2,106 |
|
|
|
3,006 |
|
|
|
9,224 |
|
|
|
11,636 |
|
|
|
15,751 |
|
| All‑in sustaining
costs |
|
$ |
62,349 |
|
|
$ |
66,940 |
|
|
$ |
234,457 |
|
|
$ |
239,146 |
|
|
$ |
249,018 |
|
| Ounces sold (GEO) |
|
|
39.6 |
|
|
|
39.3 |
|
|
|
127.5 |
|
|
|
139.5 |
|
|
|
155.3 |
|
| Cash cost per ounce
sold ($/GEO) |
|
$ |
1,228 |
|
|
$ |
1,321 |
|
|
$ |
1,413 |
|
|
$ |
1,306 |
|
|
|
1,262 |
|
| AISC per ounce sold
($/GEO) |
|
$ |
1,573 |
|
|
$ |
1,701 |
|
|
$ |
1,840 |
|
|
$ |
1,714 |
|
|
|
1,603 |
|
Technical Information
The technical content of this news release
related to financial results, mining and development projects has
been reviewed and approved by William (Bill) Shaver, P.Eng., COO of
McEwen Mining and a Qualified Person as defined by SEC S-K 1300 and
the Canadian Securities Administrators National Instrument 43-101
"Standards of Disclosure for Mineral Projects."
Reliability of Information Regarding San
José
The Company accounts for its investment in
Minera Santa Cruz S.A., the owner of the San José Mine, using the
equity method. The Company relies on the management of MSC to
provide accurate financial information prepared in accordance with
GAAP. While the Company is not aware of any errors or possible
misstatements of the financial information provided by MSC, MSC is
responsible for and has supplied to the Company all reported
results from the San José Mine, and such results are unaudited as
of the date of this release. McEwen Mining’s joint venture partner,
a subsidiary of Hochschild Mining plc, and its affiliates other
than MSC do not accept responsibility for the use of project data
or the adequacy or accuracy of this release.
CAUTION CONCERNING FORWARD-LOOKING
STATEMENTS
This news release contains certain
forward-looking statements and information, including
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. The forward-looking
statements and information expressed, as at the date of this news
release, McEwen Mining Inc.'s (the "Company") estimates, forecasts,
projections, expectations or beliefs as to future events and
results. Forward-looking statements and information are necessarily
based upon a number of estimates and assumptions that, while
considered reasonable by management, are inherently subject to
significant business, economic and competitive uncertainties, risks
and contingencies, and there can be no assurance that such
statements and information will prove to be accurate. Therefore,
actual results and future events could differ materially from those
anticipated in such statements and information. Risks and
uncertainties that could cause results or future events to differ
materially from current expectations expressed or implied by the
forward-looking statements and information include, but are not
limited to, effects of the COVID-19 pandemic, fluctuations in the
market price of precious metals, mining industry risks, political,
economic, social and security risks associated with foreign
operations, the ability of the Company to receive or receive in a
timely manner permits or other approvals required in connection
with operations, risks associated with the construction of mining
operations and commencement of production and the projected costs
thereof, risks related to litigation, the state of the capital
markets, environmental risks and hazards, uncertainty as to
calculation of mineral resources and reserves, foreign exchange
volatility, foreign exchange controls, foreign currency risk, and
other risks. Readers should not place undue reliance on
forward-looking statements or information included herein, which
speak only as of the date hereof. The Company undertakes no
obligation to reissue or update forward-looking statements or
information as a result of new information or events after the date
hereof except as may be required by law. See McEwen Mining's Annual
Report on Form 10-K for the fiscal year ended December 31, 2022,
Quarterly Report on Form 10-Q for the three and six months ended
June 30, 2023, and other filings with the Securities and Exchange
Commission, under the caption "Risk Factors", for additional
information on risks, uncertainties and other factors relating to
the forward-looking statements and information regarding the
Company. All forward-looking statements and information made in
this news release are qualified by this cautionary statement.
The NYSE and TSX have not reviewed and do not
accept responsibility for the adequacy or accuracy of the contents
of this news release, which has been prepared by the management of
McEwen Mining Inc.
ABOUT MCEWEN MINING
McEwen Mining is a gold and silver producer with
operations in Nevada, Canada, Mexico and Argentina. In addition, it
owns approximately 47.7% of McEwen Copper which owns the large,
advanced stage Los Azules copper project in Argentina. The
Company’s goal is to improve the productivity and life of its
assets with the objective of increasing its share price and
providing a yield. Rob McEwen, Chairman and Chief Owner, has a
personal investment in the group of US$220 million and takes an
annual salary of US$1.
Want News Fast?
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|
WEB SITE |
|
SOCIAL
MEDIA |
|
|
|
|
|
www.mcewenmining.com |
|
McEwen Mining |
Facebook: |
facebook.com/mcewenmining |
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LinkedIn: |
linkedin.com/company/mcewen-mining-inc- |
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CONTACT
INFORMATION |
|
Twitter: |
twitter.com/mcewenmining |
|
|
|
150 King Street West |
|
Instagram: |
instagram.com/mcewenmining |
|
|
|
Suite 2800, PO Box 24 |
|
|
|
|
|
|
|
Toronto, ON, Canada |
|
McEwen Copper |
Facebook: |
facebook.com/mcewencopper |
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|
M5H 1J9 |
|
LinkedIn: |
linkedin.com/company/mcewencopper |
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|
Twitter: |
twitter.com/mcewencopper |
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|
|
Relationship with
Investors: |
|
Instagram: |
instagram.com/mcewencopper |
|
|
|
(866)-441-0690 - Toll free line |
|
|
|
|
|
|
|
(647)-258-0395 |
|
Rob
McEwen |
Facebook: |
facebook.com/mcewenrob |
|
|
|
Mihaela Iancu ext. 320 |
|
LinkedIn: |
linkedin.com/in/robert-mcewen-646ab24 |
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|
info@mcewenmining.com |
|
Twitter: |
twitter.com/robmcewenmux |
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Grafico Azioni McEwen Mining (NYSE:MUX)
Storico
Da Nov 2024 a Dic 2024
Grafico Azioni McEwen Mining (NYSE:MUX)
Storico
Da Dic 2023 a Dic 2024
