Gold production for the first quarter rose to a quarterly record 45,201 ounces, an increase of 24 percent over the 36,571 ounces produced the prior years first quarter. The record production was due to the additional ounces from the new Fachinal mine in southern Chile, and increased production at two other properties. Fachinal also contributed to a 43 percent increase in first quarter silver production compared to last year. This year the Company achieved a quarterly record for silver with a total production of 2,191,685 ounces, compared to 1,528,817 ounces produced during the first quarter a year ago.
Average metals prices realized in the first quarter were $401.40 per ounce for gold and $5.57 per ounce for silver compared to $379.36 per ounce of gold and $4.70 per ounce of silver during the comparable period in 1995.
Coeur further strengthened its balance sheet by successfully raising $150 million through the sale of Mandatory Adjustable Redeemable Convertible Securities (MARCS), which will be mandatorily convertible into common stock four years after issuance, unless earlier converted by the holder into common stock or redeemed for common stock by the Company. Both Standard & Poors and Moodys rating agencies upgraded their rating outlook on the Company to positive following registration of the MARCS, which are valued as equity.
In December 1995, the Company converted into equity all $75 million principal amount of its 7% Convertible Subordinated Debentures, which significantly reduced its 1996 interest obligations.
Rochester Mine - Nevada
Rochester became the largest primary silver mine in the history of the state of Nevada when it passed an historical production milestone of 50 million total ounces of silver produced since operations began in 1986. The mine is also a substantial gold producer, surpassing 500,000 ounces of gold production since operations began.
First quarter 1996 production increased from year earlier levels, with 1,541,202 ounces of silver and 15,826 ounces of gold produced during the period, compared to 1,429,821 ounces of silver and 12,991 ounces of gold during the same quarter of the previous year.
Cash operating costs at Rochester were $3.72 per ounce of silver equivalent in the first quarter of 1996, compared to $3.76 per ounce in the same period a year ago. Full costs were $4.31 per silver equivalent ounce in the 1996 period compared to $4.37 in the year earlier period.
Fachinal Mine - Chile
The new Fachinal mine in Chile produced 6,435 ounces of gold and 575,400 ounces of silver in its initial first quarter of production. During the first quarter, the mine was still considered to be in its startup, or pre-commercial phase, with capitalized mine costs to be offset by the sale of silver and gold produced during that period. Fachinal is expected to reach its full commercial production status in the second quarter of 1996.
El Bronce Mine - Chile
El Bronce continued to show its steady, planned increases in gold production, along with lowered costs, as the mining improvements implemented by Coeur since gaining 51 percent operating control continued to take effect. During the first quarter, El Bronce produced 6,307 ounces of gold and 13,248 ounces of silver compared to 4,978 ounces of gold and 21,611 ounces of silver a year ago.
Cash operating costs at El Bronce were lowered to $244.05 per ounce of gold during the first quarter 1996 from $267.82 per ounce in the previous years period. Full costs were $263.83 per ounce compared to $288.82 in the year earlier period.
Golden Cross Mine - New Zealand
Golden Cross produced 16,633 ounces of gold and 61,835 ounces of silver during the first quarter of 1996, compared to 18,602 ounces of gold and 77,385 ounces of silver in the first quarter last year. The reduced production was due to anticipated lower grades in the open pit portion of the mine. These temporary grade changes also impacted cash operating costs, which were $322.35 per ounce of gold in the first quarter, compared to $240.05 during the same period a year ago. Full costs were $391.79 per ounce of gold in the 1996 first quarter compared to $321.66 per ounce in the year earlier period.
Gasgoyne Gold Mines - Australia
Coeur has acquired an interest in Gasgoyne Gold Mines, a profitable gold producer with operations in western Australia. Presently, Coeurs interest in Gasgoyne stands at 35.4 percent, following an initial tender offer completed in April. During its recently completed quarter, Gasgoyne recorded a record 15,912 ounces of gold production at a cash operating cost of US$185 per ounce. Commencing in the second quarter, Coeur will begin reporting its share of Gasgoynes net results of operations in Coeurs financial results.
1996 FIRST QUARTER
FINANCIAL STATEMENTS
Including:
Anthony R. Ebersole
Director of Investor
Relations
Coeur d'Alene Mines Corporation
505 Front Street, P.O. Box I
Coeur d'Alene, Idaho 83816-0316
Telephone: 208.667.3511
Facsimile: 208.667.2213
E-mail: tebersol@dmi.net