Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Jul. 30, 2019 | |
Entity Registrant Name | McEwen Mining Inc. | |
Entity Central Index Key | 0000314203 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2019 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity File Number | 001-33190 | |
Entity Incorporation, State or Country Code | CO | |
Entity Tax Identification Number | 84-0796160 | |
Entity Address, Address Line One | 150 King Street West | |
Entity Address, Address Line Two | SuiteĀ 2800 | |
Entity Address, City or Town | Toronto | |
Entity Address, State or Province | ON | |
Entity Address, Country | CA | |
Entity Address, Postal Zip Code | M5H 1J9 | |
City Area Code | 866 | |
Local Phone Number | 441-0690 | |
Amendment Flag | false | |
Title of 12(b) Security | Common stock, no par value | |
Trading Symbol | MUX | |
Security Exchange Name | NYSE | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 362,010,925 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS) INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
REVENUE: | ||||
Revenue | $ 36,383 | $ 33,806 | $ 51,966 | $ 74,847 |
OPERATING EXPENSES: | ||||
Depreciation and depletion | 7,007 | 4,099 | 10,013 | 7,189 |
Gross profit | 4,677 | 9,092 | 6,105 | 23,320 |
OTHER OPERATING EXPENSES: | ||||
Advanced projects | 2,095 | 2,756 | 4,741 | 5,760 |
Exploration | 5,872 | 9,609 | 10,022 | 21,484 |
General and administrative | 3,172 | 2,997 | 5,433 | 6,131 |
Loss from investment in Minera Santa Cruz S.A. (note 8) | 4,137 | 2,265 | 6,447 | 2,477 |
Depreciation | 169 | 273 | 321 | 633 |
Revision of estimates and accretion of asset retirement obligations (note 11) | 427 | 288 | 888 | 582 |
Total other operating expenses | 15,872 | 18,188 | 27,852 | 37,067 |
Operating loss | (11,195) | (9,096) | (21,747) | (13,747) |
OTHER (EXPENSE) INCOME: | ||||
Interest and other finance (expense) income, net | (2,783) | 354 | (3,296) | 220 |
Other income (expense) (note 3) | 463 | 1,222 | 1,510 | (342) |
Total other (expense) income | (2,320) | 1,576 | (1,786) | (122) |
Gain (loss) on investments (note 2) | 1,752 | (2,502) | ||
Loss before income and mining taxes | (13,515) | (7,520) | (23,533) | (13,869) |
Income and mining tax recovery | 501 | 2,140 | 383 | 3,278 |
Net loss and comprehensive loss | $ (13,014) | $ (5,380) | $ (23,150) | $ (10,591) |
Net loss per share (note 13): | ||||
Basic and Diluted (in dollars per share) | $ (0.04) | $ (0.02) | $ (0.07) | $ (0.03) |
Weighted average common shares outstanding (thousands) (note 13): | ||||
Basic and Diluted (in shares) | 346,998 | 337,087 | 346,095 | 337,075 |
Shareholders' distribution declared per common share (note 12) | 0.005 | |||
Gold and silver sales | ||||
REVENUE: | ||||
Revenue | $ 36,383 | $ 33,806 | $ 51,966 | $ 74,847 |
Production costs applicable to sales | ||||
OPERATING EXPENSES: | ||||
Cost of goods and services sold | 24,699 | 20,615 | 35,848 | 44,338 |
Exploration | ||||
OPERATING EXPENSES: | ||||
Cost of goods and services sold | $ 5,872 | $ 9,609 | $ 10,022 | $ 21,484 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 9,325 | $ 15,756 |
Investments (note 4) | 5,147 | 3,131 |
Receivables and other current assets (note 5) | 4,605 | 3,765 |
Inventories (note 6) | 32,987 | 22,039 |
Restricted cash (note 12) | 13,112 | 14,685 |
Total current assets | 65,176 | 59,376 |
Mineral property interests and plant and equipment, net (note 7) | 436,120 | 423,879 |
Investment in Minera Santa Cruz S.A. (note 8) | 119,347 | 127,814 |
Other assets (note 6 and note 17) | 2,564 | 5,872 |
TOTAL ASSETS | 623,207 | 616,941 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 28,726 | 30,817 |
Flow-through share premium (note 12) | 2,344 | 2,950 |
Lease liabilities, current portion (note 9) | 2,007 | 1,511 |
Asset retirement obligation, current portion (note 11) | 1,218 | 734 |
Total current liabilities | 34,295 | 36,012 |
Lease liabilities, long term (note 9) | 6,001 | 4,918 |
Long-term debt (note 10) | 24,678 | 24,603 |
Long-term debt from related party (note 10) | 24,678 | 24,603 |
Asset retirement obligation, long term (note 11) | 33,771 | 28,668 |
Other liabilities | 5,208 | 5,765 |
Deferred income and mining tax liability | 6,562 | 6,426 |
Total liabilities | 135,193 | 130,995 |
Shareholders' equity: | ||
Common stock and additional paid-in capital, no par value, 500,000 shares authorized (in thousands); Common: 361,957 as of June 30, 2019 and 344,560 as of December 31, 2018 issued and outstanding (in thousands) (note 12) | 1,480,006 | 1,457,422 |
Warrants (note 12) | 2,634 | |
Accumulated deficit | (994,626) | (971,476) |
Total shareholders' equity | 488,014 | 485,946 |
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | $ 623,207 | $ 616,941 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Common stock, par value | $ 0 | $ 0 |
Common stock, shares authorized | 500,000 | 500,000 |
Common, shares issued | 361,957 | 344,560 |
Common, shares outstanding | 361,957 | 344,560 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Common StockDirect Offering | Common StockATM offering | Common Stock | WarrantsDirect Offering | Warrants | Accumulated Deficit | Direct Offering | ATM offering | Total |
Balance at Dec. 31, 2017 | $ 1,444,056 | $ 3,823 | $ (926,606) | $ 521,273 | |||||
Balance (in shares) at Dec. 31, 2017 | 337,051,000 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||
Stock-based compensation | $ 396 | 396 | |||||||
Exercise of stock options | $ 45 | $ 45 | |||||||
Exercise of stock options (in shares) | 39,000 | 39,199 | |||||||
Shareholder distribution | $ (1,686) | $ (1,686) | |||||||
Shares issued for acquisition of mineral property interests | $ 391 | 391 | |||||||
Shares issued for acquisition of mineral property interests (in shares) | 178,000 | ||||||||
Net loss | (10,591) | (10,591) | |||||||
Balance at Jun. 30, 2018 | $ 1,443,202 | 3,823 | (937,197) | 509,828 | |||||
Balance (in shares) at Jun. 30, 2018 | 337,268,000 | ||||||||
Balance at Mar. 31, 2018 | $ 1,442,613 | 3,823 | (931,817) | 514,619 | |||||
Balance (in shares) at Mar. 31, 2018 | 337,086,000 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||
Stock-based compensation | $ 193 | 193 | |||||||
Exercise of stock options | $ 5 | 5 | |||||||
Exercise of stock options (in shares) | 4,000 | ||||||||
Shares issued for acquisition of mineral property interests | $ 391 | 391 | |||||||
Shares issued for acquisition of mineral property interests (in shares) | 178,000 | ||||||||
Net loss | (5,380) | (5,380) | |||||||
Balance at Jun. 30, 2018 | $ 1,443,202 | 3,823 | (937,197) | 509,828 | |||||
Balance (in shares) at Jun. 30, 2018 | 337,268,000 | ||||||||
Balance at Dec. 31, 2018 | $ 1,457,422 | (971,476) | 485,946 | ||||||
Balance (in shares) at Dec. 31, 2018 | 344,560,000 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||
Stock issued during the period | $ 1,900 | ||||||||
Balance at Mar. 31, 2019 | $ 1,477,342 | 2,467 | (981,612) | 498,197 | |||||
Balance (in shares) at Mar. 31, 2019 | 359,986,000 | ||||||||
Balance at Dec. 31, 2018 | $ 1,457,422 | (971,476) | 485,946 | ||||||
Balance (in shares) at Dec. 31, 2018 | 344,560,000 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||
Stock-based compensation | $ 197 | 197 | |||||||
Stock issued during the period | $ 20,276 | $ 1,851 | 20,300 | $ 2,634 | 2,600 | $ 22,910 | $ 1,851 | 22,900 | |
Stock issued during the period (in shares) | 16,129,000 | 1,010,000 | |||||||
Exercise of stock options | $ 260 | $ 260 | |||||||
Exercise of stock options (in shares) | 258,000 | 257,500 | |||||||
Net loss | (23,150) | $ (23,150) | |||||||
Balance at Jun. 30, 2019 | $ 1,480,006 | 2,634 | (994,626) | 488,014 | |||||
Balance (in shares) at Jun. 30, 2019 | 361,957,000 | ||||||||
Balance at Mar. 31, 2019 | $ 1,477,342 | 2,467 | (981,612) | 498,197 | |||||
Balance (in shares) at Mar. 31, 2019 | 359,986,000 | ||||||||
Increase (Decrease) in Shareholders' Equity | |||||||||
Stock-based compensation | $ 136 | 136 | |||||||
Stock issued during the period | $ 2,491 | $ 167 | $ 2,658 | ||||||
Stock issued during the period (in shares) | 1,935,000 | ||||||||
Exercise of stock options | $ 37 | 37 | |||||||
Exercise of stock options (in shares) | 36,000 | ||||||||
Net loss | (13,014) | (13,014) | |||||||
Balance at Jun. 30, 2019 | $ 1,480,006 | $ 2,634 | $ (994,626) | $ 488,014 | |||||
Balance (in shares) at Jun. 30, 2019 | 361,957,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Cash paid to suppliers and employees | $ (57,286) | $ (74,939) |
Cash flow from revenues | 50,672 | 75,464 |
Interest paid | (2,598) | |
Interest received | 60 | 96 |
Cash (used in) provided by operating activities | (9,152) | 621 |
Cash flows from investing activities: | ||
Additions to mineral property interests and plant and equipment | (24,484) | (27,405) |
Investment in marketable equity securities (note 4) | (510) | |
Proceeds from sale of investments (note 4) | 3,667 | |
Return of investment received from Minera Santa Cruz S.A. (note 8) | 2,020 | 7,231 |
Cash used in investing activities | (22,464) | (17,017) |
Cash flows from financing activities: | ||
Proceeds of exercise of stock options (note 12) | 260 | 45 |
Payment of lease obligations (note 9) | (1,026) | |
Shareholders' distribution (note 8) | (1,685) | |
Cash provided by (used in) financing activities | 23,995 | (1,640) |
Effect of exchange rate change on cash and cash equivalents | (383) | 580 |
(Decrease) increase in cash, cash equivalents and restricted cash | (8,004) | (17,456) |
Cash, cash equivalents and restricted cash, beginning of period | 30,489 | 37,153 |
Cash, cash equivalents and restricted cash, end of period (note 17) | 22,485 | 19,697 |
Reconciliation of net loss to cash (used in) provided by operating activities: | ||
Net loss | (23,150) | (10,591) |
Adjustments to reconcile net loss from operating activities: | ||
Loss from investment in Minera Santa Cruz S.A., net of amortization (note 8) | 6,447 | 2,477 |
(Gain) loss on investments (note 4) | (1,752) | 2,502 |
Loss on disposal of fixed assets | 99 | |
Income and mining tax recovery | (383) | (3,278) |
Stock-based compensation (note 12) | 197 | 396 |
Revision of estimates and accretion of asset retirement obligations (note 11) | 888 | 582 |
Unrealized foreign exchange loss (gain) (note 11) | 610 | (629) |
Depreciation and amortization | 6,768 | 8,188 |
Unrealized foreign exchange gain (loss) | 383 | (580) |
Change in non-cash working capital items: | ||
(Increase) decrease in other assets related to operations | (2,895) | 6,492 |
Increase (decrease) in liabilities related to operations | 3,735 | (5,037) |
Cash (used in) provided by operating activities | (9,152) | $ 621 |
Direct Offering | ||
Cash flows from financing activities: | ||
Proceeds from issuance of shares (note 12) | 22,910 | |
ATM offering | ||
Cash flows from financing activities: | ||
Proceeds from issuance of shares (note 12) | $ 1,851 |
NATURE OF OPERATIONS AND RECENT
NATURE OF OPERATIONS AND RECENT ACCOUNTING PRONOUNCEMENTS | 6 Months Ended |
Jun. 30, 2019 | |
NATURE OF OPERATIONS AND RECENT ACCOUNTING PRONOUNCEMENTS | NOTE 1 NATURE OF OPERATIONS AND RECENT ACCOUNTING PRONOUNCEMENTS ā Nature of Operations and Basis of Presentation McEwen Mining Inc. (āMcEwen Miningā, or the āCompanyā) was organized under the laws of the State of Colorado on July 24, 1979. The Company is engaged in the exploration, development, production and sale of gold and silver and exploration for copper. The Company operates in the United States, Canada, Mexico and Argentina The Company owns the Gold Bar gold mine in Nevada, the Black Fox gold mine in Ontario, Canada, the El Gallo Project in Sinaloa, Mexico, the Los Azules copper deposit in San Juan, Argentina, the Fenix silver-gold project in Sinaloa, Mexico, and a portfolio of exploration properties in Nevada, Canada, Mexico and Argentina. interest in Minera Santa Cruz S.A. (āMSCā), owner of the producing San JosĆ© silver-gold mine in Santa Cruz, Argentina, which is operated by the joint venture majority owner, Hochschild Mining plc. The interim consolidated financial statements included herein have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission (āSECā) and are unaudited. Certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (āU.S. GAAPā) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures included are adequate to make the information presented not misleading. In managementās opinion, the unaudited Consolidated Statements of Operations and Comprehensive Loss Statement of Operations Consolidated Balance Sheets Consolidated Statement of Changes in Shareholdersā Equity Consolidated Statements of Cash Flows Recently Adopted Accounting Pronouncements Leases ā ASC 842: From 2016 to 2019, the FASB issued multiple accounting standard updates (āASUā) regarding the new ASC 842. The ASUs outline amendments and updates to ASC 842, which provides that a lessee should recognize the assets and the liabilities that arise from leases, including operating leases. Under the new requirements, a lessee is required to recognize in the statement of financial position a liability to make lease payments (the lease liability) and the right-of-use asset representing the right to the underlying asset for the lease term. Adoption of this ASC was completed by the Company under a modified retrospective transition method with certain practical expedients. The Companyās initial date of adoption was January 1, 2019; the adoption of ASC 842 did not result in Practical expedients and elections under ASUs and ASC 842 made by the Company are as follows: ASU 2018-11: This update permitted an entity to elect an optional transitional practical expedient to continue to apply ASC 840, Leases, including its disclosure requirements, in the comparative periods presented in the year of adoption of ASC 842. Under this optional practical expedient, the Company applied the transition provisions on January 1, 2019 (the date of adoption) rather than January 1, 2017 (the beginning of the earliest comparative period presented); first reporting under the new standard was for the first quarter of 2019. Upon adoption of ASC 842, the Company recognized a cumulative-effect adjustment to the opening accumulated deficit balance. Package of practical expedients ā which permits an entity to (a) not reassess whether expired or existing contracts contain leases, (b) not reassess lease classification for existing or expired leases and (c) not consider whether previously capitalized initial direct costs would be appropriate under the new standard. The Company opted to elect the package of practical expedients. Hindsight practical expedient ā which permits an entity to use hindsight in determining the lease term. The Company opted to elect this provision. Easements practical expedient ā which permits an entity to elect an optional transitional practical expedient to not evaluate land easements that exist or expire before the entityās adoption of ASC 842 that were not previously accounted for as leases under ASC 840. The Company opted to elect this transitional provision and as a result did not evaluate any of its land agreements. Short term election ā which permits an entity to elect not to apply lease accounting to leases that are not greater than 12 months. The Company elected this short term election. Non-lease component election ā which permits lessees to elect to account for non-lease components as part of the lease component to which they relate; an election made by class of underlying asset. This election is not relevant for the Company and therefore, the Company did not make the election. The adoption included the following overall impact (a) increase the Companyās recorded assets and liabilities, (b) increase related depreciation and amortization expense, (c) increase interest expense and (d) decrease lease/rental expenses. Note 9 Leases Lease Accounting Policy: Contracts entered into are analyzed to identify whether the contract contains an operating or financing lease according to ASC 842. If a contract is determined to contain a lease, the Company includes the lease payments (the lease liability) and the right-of-use asset representing the right to the underlying asset for the lease term within the Consolidated Balance Sheets . Consolidated Statements of Operations For leases with a term of twelve months or less, an accounting policy election is made to not recognize lease assets and lease liabilities. The Company has not Operating and right-of-use (āROUā) asset balances and lease liabilities are recognized at the commencement date based on the present value of the future lease payments over the lease term. The Company utilizes the incremental borrowing rate (āIBRā) in determining the present value of the future lease payments. IBR represents the rate of interest that a lessee would have to pay to borrow an amount equal to the lease payments on a collateralized basis over a similar term in a similar economic environment. Each leaseās IBR is determined by using the average bond yield ratings for comparable companies. Recently Issued Accounting Pronouncements Changes to the Disclosure Requirements for Fair Value Measurement: In August 2018, the FASB issued ASU 2018- 13, āFair Value Measurement (ASC 820): Disclosure Framework ā Changes to the Disclosure Requirements for Fair Value Measurementā. This update modifies the disclosure requirements for fair value measurements by removing, modifying or adding disclosures. ASU 2018-13 is effective for fiscal years beginning after December 15, 2019 and early adoption is permitted. Certain disclosures in the update will be applied retrospectively, while others will be applied prospectively. The Company is currently evaluating the potential impact of adopting this guidance on its financial statements. Reclassifications Certain amounts in prior years have been reclassified to conform to the 2019 presentation. Reclassified amounts were not material to the financial statements and relate to the presentation of Other Operating Expenses. Advanced projects in the Statement of Operations includes mine development costs, property holding and general and administrative costs associated with our projects at an advanced stage. Exploration in the Statement of Operations includes exploration expenses, property holding and general and administrative costs associated with exploration stage projects. General and Administrative in the Statement of Operations include corporate (head office) general and administrative costs |
OPERATING SEGMENT REPORTING
OPERATING SEGMENT REPORTING | 6 Months Ended |
Jun. 30, 2019 | |
OPERATING SEGMENT REPORTING | NOTE 2 OPERATING SEGMENT REPORTING McEwen Mining is a mining and minerals production and exploration company focused on precious metals in Argentina, Mexico, Canada, and the United States. The Companyās chief operating decisions maker (āCODMā) reviews the operating results, assesses performance and makes decisions about allocation of resources to these segments at the geographic region level or major mine/project where the economic characteristics of the individual mines or projects are not alike. As a result, these operating segments also represent the Companyās reportable segments. The Companyās business activities that are not considered operating segments are included in General and Administrative and other The CODM reviews segment income (loss), defined as gold and silver sales less production costs applicable to sales, depreciation and depletion, advanced projects and exploration costs, for all segments except for the MSC segment which is evaluated based on the attributable equity income or loss. Gold and silver sales and production costs applicable to sales for the reportable segments are reported net of intercompany transactions. Significant information relating to the Companyās reportable operating segments is summarized in the tables below: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, 2019 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ 11,522 ā $ 16,049 ā $ 8,812 ā $ ā ā $ ā ā $ 36,383 Production costs applicable to sales ā ā (7,835) ā ā (10,639) ā ā (6,225) ā ā ā ā ā ā ā (24,699) Depreciation and depletion ā ā (2,568) ā ā (4,221) ā ā (218) ā ā ā ā ā ā ā ā (7,007) Gross profit ā ā 1,119 ā ā 1,189 ā ā 2,369 ā ā ā ā ā ā ā ā 4,677 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (390) ā ā ā ā ā (1,705) ā ā ā ā ā ā ā (2,095) Exploration ā ā (1,292) ā ā (4,062) ā ā ā ā ā ā ā ā (518) ā ā (5,872) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (4,137) ā ā ā ā (4,137) Segment (loss) income ā $ (563) ā $ (2,873) ā $ 664 ā $ (4,137) ā $ (518) ā $ (7,427) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (6,088) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (13,515) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Six months ended June 30, 2019 USA ā Canada ā ā Mexico ā ā MSC Los Azules Total Revenue from gold and silver sales ā $ 12,364 ā $ 24,992 ā $ 14,610 ā $ ā ā $ ā ā $ 51,966 Production costs applicable to sales ā ā (8,643) ā ā (16,475) ā ā (10,730) ā ā ā ā ā ā ā (35,848) Depreciation and depletion ā ā (2,720) ā ā (6,931) ā ā (362) ā ā ā ā ā ā ā ā (10,013) Gross profit ā ā 1,001 ā ā 1,586 ā ā 3,518 ā ā ā ā ā ā ā ā 6,105 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (586) ā ā ā ā ā (4,155) ā ā ā ā ā ā ā (4,741) Exploration ā ā (1,902) ā ā (6,483) ā ā ā ā ā ā ā ā (1,637) ā (10,022) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (6,447) ā ā ā ā (6,447) Segment loss ā $ (1,487) ā $ (4,897) ā $ (637) ā $ (6,447) ā $ (1,637) ā $ (15,105) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (8,428) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (23,533) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, 2018 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ ā ā $ 19,425 ā $ 14,381 ā $ ā ā $ ā ā $ 33,806 Production costs applicable to sales ā ā ā ā ā (11,981) ā ā (8,634) ā ā ā ā ā ā ā ā (20,615) Depreciation and depletion ā ā ā ā ā (3,526) ā ā (573) ā ā ā ā ā ā ā ā (4,099) Gross profit ā ā ā ā ā 3,918 ā ā 5,174 ā ā ā ā ā ā ā ā 9,092 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (1,591) ā ā ā ā ā (1,165) ā ā ā ā ā ā ā ā (2,756) Exploration ā ā (1,151) ā ā (5,788) ā ā (329) ā ā ā ā ā (2,341) ā ā (9,609) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (2,265) ā ā ā ā ā (2,265) Segment (loss) income ā $ (2,742) ā $ (1,870) ā $ 3,680 ā $ (2,265) ā $ (2,341) ā $ (5,538) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (1,982) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (7,520) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Six months ended June 30, 2018 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ ā ā $ 35,049 ā $ 39,798 ā $ ā ā $ ā ā $ 74,847 Production costs applicable to sales ā ā ā ā ā (22,532) ā ā (21,806) ā ā ā ā ā ā ā ā (44,338) Depreciation and depletion ā ā ā ā ā (5,784) ā ā (1,405) ā ā ā ā ā ā ā ā (7,189) Gross profit ā ā ā ā ā 6,733 ā ā 16,587 ā ā ā ā ā ā ā ā 23,320 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (2,633) ā ā ā ā ā (3,127) ā ā ā ā ā ā ā ā (5,760) Exploration ā ā (3,151) ā ā (11,167) ā ā (1,300) ā ā ā ā ā (5,866) ā ā (21,484) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (2,477) ā ā ā ā ā (2,477) Segment (loss) income ā $ (5,784) ā $ (4,434) ā $ 12,160 ā $ (2,477) ā $ (5,866) ā $ (6,401) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (7,468) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (13,869) ā Geographic information Geographic information includes the long-lived assets balance and revenues presented for the companyās operating segments, as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Long-lived Assets ā Revenue (1) ā ā June 30, ā December 31, ā Three months ended June 30, ā Six months ended June 30, ā 2019 2018 2019 2018 ā 2019 ā 2018 Canada ā $ 85,437 ā $ 84,119 ā $ 16,049 ā $ 19,425 ā $ 24,992 ā $ 35,049 Mexico ā ā 23,783 ā ā 26,524 ā ā 8,812 ā ā 14,381 ā ā 14,610 ā ā 39,798 USA ā ā 137,974 ā ā 127,617 ā ā 11,522 ā ā ā ā ā 12,364 ā ā ā Argentina (2) ā ā 310,837 ā ā 319,305 ā ā ā ā ā ā ā ā ā ā ā ā Total consolidated ā $ 558,031 ā $ 557,565 ā $ 36,383 ā $ 33,806 ā $ 51,966 ā $ 74,847 (1) Presented based on the location from which the product originated. (2) Includes Investment in MSC of $119.3 million as of June 30, 2019 (December 31, 2018 ā $127.8 million). |
OTHER INCOME (EXPENSES)
OTHER INCOME (EXPENSES) | 6 Months Ended |
Jun. 30, 2019 | |
OTHER INCOME (EXPENSE) | NOTE 3 OTHER INCOME (EXPENSE) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, ā ā Six months ended June 30, ā 2019 2018 ā ā 2019 ā 2018 Unrealized and realized gain (loss) on investments (note 4) ā $ 925 ā $ (534) ā ā $ 1,752 ā $ (3,269) Foreign currency (loss) gain ā ā (537) ā ā 1,482 ā ā ā (374) ā ā 2,409 Other income ā ā 75 ā ā 373 ā ā ā 132 ā ā 617 Loss on sale of assets ā ā ā ā ā (99) ā ā ā ā ā ā (99) Total other income (expense) ā $ 463 ā $ 1,222 ā ā $ 1,510 ā $ (342) ā |
INVESTMENTS
INVESTMENTS | 6 Months Ended |
Jun. 30, 2019 | |
INVESTMENTS | NOTE 4 INVESTMENTS The following is a summary of the activity in investments for the six months ended June 30, 2019 and 2018: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions ā Net gain ā Disposals ā Unrealized ā Fair value ā ā December 31, ā during ā (loss) on ā during ā gain (loss) on ā June 30, ā 2018 period securities sold period securities held 2019 Marketable equity securities ā $ 2,718 ā $ 264 ā $ ā ā $ ā ā $ 1,372 ā $ 4,354 Warrants ā 413 ā ā ā ā ā ā ā 380 ā 793 Investments ā $ 3,131 ā $ 264 ā $ ā ā $ ā ā $ 1,752 ā $ 5,147 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions ā Net gain ā Disposals ā Unrealized ā Fair value ā ā December 31, ā during ā (loss) on ā during ā gain (loss) on ā June 30, ā 2017 period securities sold period securities held 2018 Marketable equity securities ā $ 6,404 ā $ 1,211 ā $ (767) ā $ (2,899) ā $ (1,637) ā $ 2,312 Warrants ā 1,567 ā ā ā ā ā ā ā ā (702) ā ā (865) ā ā ā Investments ā $ 7,971 ā $ 1,211 ā $ (767) ā $ (3,601) ā $ (2,502) ā $ 2,312 ā Cost of marketable equity securities and warrants at June 30, 2019 was $3.1 million (December 31, 2018 ā $2.9 million). During the three months ended June 30, 2019, the Company recognized a $0.9 million unrealized gain on investments (same period in 2018 ā $0.5 million unrealized loss), which included $0.7 million unrealized gain on equity securities and $0.2 million on warrants. During the three months ended June 30, 2018, the Company sold marketable equity securities for proceeds of $0.2 million and realized a loss of nominal value. |
RECEIVABLES AND OTHER CURRENT A
RECEIVABLES AND OTHER CURRENT ASSETS | 6 Months Ended |
Jun. 30, 2019 | |
RECEIVABLES AND OTHER CURRENT ASSETS | |
RECEIVABLES AND OTHER CURRENT ASSETS | NOTE 5 RECEIVABLES AND OTHER CURRENT ASSETS The following is a breakdown of balances in receivables and other current assets as at June 30, 2019 December 31, 2018: ā ā ā ā ā ā ā ā ā ā June 30, 2019 ā December 31, 2018 Trade receivable ā $ 1,294 ā $ ā Government sales tax receivable ā ā 2,128 ā ā 2,079 Other current assets ā ā 1,183 ā ā 1,686 Receivables and other current assets ā $ 4,605 ā $ 3,765 ā Trade receivable includes a $1.3 million receivable for revenue from gold sales for which payment was not received at June 30, 2019. Government sales tax receivable includes $1.1 million of Mexican value added tax (āVATā) at June 30, 2019 (December 31, 2018 ā $1.1 million). The Company collected $1.0 million of VAT during the six months ended June 30, 2019 (June 30, 2018 ā $2.9 million). |
INVENTORIES
INVENTORIES | 6 Months Ended |
Jun. 30, 2019 | |
INVENTORIES | NOTE 6 INVENTORIES Current inventories at June 30, 2019 and December 31, 2018 consisted of the following: ā ā ā ā ā ā ā ā ā ā June 30, 2019 December 31, 2018 Material on leach pads $ 21,122 $ 10,370 ā In-process inventory ā 3,919 ā 3,446 ā Stockpiles ā 1,839 ā 1,272 ā Precious metals ā 2,404 ā 3,421 ā Materials and supplies ā 3,703 ā 3,530 ā Current inventories ā $ 32,987 ā $ 22,039 ā ā A portion of leach pad inventories at June 30, 2019 in the amount of $1.8 million (December 31, 2018 ā $4.6 million) is expected to be recovered beyond twelve months, and has been included in Other assets. |
MINERAL PROPERTY INTERESTS AND
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT | 6 Months Ended |
Jun. 30, 2019 | |
MINERAL PROPERTY INTERESTS, PLANT AND EQUIPMENT AND CONSTRUCTION IN PROGRESS | |
MINERAL PROPERTY INTERESTS, PLANT AND EQUIPMENT AND CONSTRUCTION IN PROGRESS | NOTE 7 MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT The definition of proven and probable reserves is set forth in the SEC Industry Guide 7. If proven and probable reserves exist at the Companyās properties, the relevant capitalized mineral property interests and asset retirement costs are charged to expense based on the units of production method upon commencement of production. The Companyās Gold Bar, Black Fox and San JosĆ© The following table summarizes mineral property interests and plant and equipment at June 30, 2019 and December 31, 2018: ā ā ā ā ā ā ā ā ā ā June 30, 2019 December 31, 2018 Mineral property interests $ 340,945 $ 326,086 ā Land ā 8,708 ā 8,699 ā Construction in progress ā ā 3,901 ā ā 74,643 ā Plant and equipment ā ā 130,572 ā ā 49,578 ā Subtotal ā $ 484,126 ā $ 459,006 ā Less: accumulated depreciation ā (48,006) ā ā (35,127) ā Net carrying value ā $ 436,120 ā $ 423,879 ā ā Plant and equipment at June 30, 2019 includes $1.4 million of capitalized interest related to the Gold Bar mine (December 31, 2018 ā $0.8 million). As at February 16, 2019, first production occurred at the Gold Bar mine and related construction-in-progress costs were transferred into the appropriate category of plant and equipment and mineral property interests and amortized. The Companyās leased assets include equipment, vehicles and office space; the assets are amortized on a straight-line basis over their estimated useful lives (see note 9 Leases ā ā ā ā ā ā ā ā ā ā ā June 30, 2019 ā ā ā Operating lease ā Finance leases ā Leased assets, cost ā $ 1,167 ā $ 8,048 ā Accumulated amortization ā ā (413) ā ā (515) ā Net book value ā $ 754 ā $ 7,533 ā ā |
INVESTMENT IN MINERA SANTA CRUZ
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | 6 Months Ended |
Jun. 30, 2019 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | NOTE 8 INVESTMENT IN MINERA SANTA CRUZ S.A. (āMSCā) ā SAN JOSĆ MINE The Company accounts for investments over which it exerts significant influence but does not control through majority ownership using the equity method of accounting. In applying the equity method of accounting to the Companyās investment in MSC, MSCās financial statements, which are originally prepared by MSC in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board, have been adjusted to conform with U.S. GAAP. As such, the summarized financial data presented under this heading is in accordance with U.S. GAAP. A summary of the operating results from MSC for the three and six months ended June 30, 2019 and 2018 is as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, ā Six months ended June 30, ā 2019 2018 2019 2018 Minera Santa Cruz S.A. ( 100% ) ā ā ā ā ā ā ā ā ā ā ā ā Revenue from gold and silver sales ā $ 62,597 ā $ 52,272 ā $ 108,800 ā $ 102,934 Production costs applicable to sales ā ā (52,896) ā ā (43,346) ā ā (89,236) ā ā (86,814) Other operating expenses ā ā (9,440) ā ā (3,553) ā ā (18,843) ā ā (7,612) Other expenses ā ā (855) ā ā (6,136) ā ā (3,298) ā ā (8,254) Net (loss) income before tax ā $ (594) ā $ (763) ā $ (2,577) ā $ 254 Current and deferred tax expense ā ā (3,049) ā ā (6,937) ā ā (3,838) ā ā (7,076) Net loss ā $ (3,643) ā $ (7,700) ā $ (6,415) ā $ (6,822) ā ā ā ā ā ā ā ā ā ā ā ā ā Portion attributable to McEwen Mining Inc. ( 49% ) ā ā ā ā ā ā ā ā ā ā ā ā Net loss ā $ (1,784) ā $ (3,773) ā $ (3,142) ā $ (3,343) Amortization of fair value increments ā (2,459) ā (2,482) ā (4,372) ā (4,597) Income tax recovery ā ā 106 ā ā 3,990 ā ā 1,067 ā ā 5,463 Loss from investment in MSC, net of amortization ā $ (4,137) ā $ (2,265) ā $ (6,447) ā $ (2,477) ā The loss from investment in MSC includes the amortization of the fair value increments arising from the purchase price allocation and related income tax recovery. Included in the income tax recovery is the impact of fluctuations in the exchange rate between the Argentina peso and the U.S. dollar on the peso-denominated deferred tax liability associated with the investment in MSC recorded as part of the acquisition of Minera Andes. Changes in the Companyās investment in MSC for the six months ended June 30, 2019 and year ended December 31, 2018 are as follows: ā ā ā ā ā ā ā ā ā June 30, 2019 December 31, 2018 Investment in MSC, beginning of period ā $ 127,814 ā $ 150,064 Attributable net loss from MSC ā ā (3,142) ā ā (10,065) Amortization of fair value increments ā (4,372) ā (9,730) Income tax recovery ā ā 1,067 ā ā 7,930 Dividend distribution received ā (2,020) ā (10,385) Investment in MSC, end of period ā $ 119,347 ā $ 127,814 ā During the three and six months ended June 30, 2019, the Company received $nil and $2.0 million, respectively, in dividends from MSC (three and six months ended June 30, 2018 ā $2.4 million and $7.2 million, respectively). A summary of the key MSCās assets and liabilities as at June 30, 2019, before and after adjustments to fair value on acquisition and amortization of the fair value increments arising from the purchase price allocation, are as follows: ā ā ā ā ā ā ā ā ā ā ā As at June 30, 2019 ā Balance excluding FV increments ā Adjustments ā Balance including FV increments Current assets ā $ 71,226 ā $ 341 ā $ 71,567 Total assets ā ā 190,935 ā ā 129,493 ā ā 320,428 ā ā ā ā ā ā ā ā ā ā Current liabilities ā $ (38,675) ā $ ā ā $ (38,675) Total liabilities ā ā (67,110) ā ā (9,754) ā ā (76,864) ā |
LEASE LIABILITIES
LEASE LIABILITIES | 6 Months Ended |
Jun. 30, 2019 | |
LEASE LIABILITIES | |
LEASE LIABILITIES | NOTE 9 LEASE LIABILITIES On January 1, 2019, the Company adopted ASC 842, āLease Accounting,ā and recorded a nominal cumulative-effect adjustment to the opening accumulated deficit balance. The Companyās lease obligations include equipment, vehicles and office space. Leased assets are included in plant and equipment (See note 7 for details). Lease liabilities as at June 30, 2019 and December 31, 2018 are as follows: ā ā ā ā ā ā ā ā ā ā Total discounted lease liabilities ā ā June 30, 2019 ā December 31, 2018 Finance leases ā $ 7,039 ā ā 6,429 Operating lease ā ā 969 ā $ ā Lease liabilities ā $ 8,008 ā $ 6,429 Current portion ā ā (2,007) ā ā (1,511) Long-term portion ā $ 6,001 ā $ 4,918 ā Lease liabilities at June 30, 2019 are recorded using a discount rate of 8.73% and 7.32% , respectively for operating and finance leases and have average remaining lease terms of five years and three years , respectively. Lease related costs for the three and six months ended June 30, 2019 are as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, ā Six months ended June 30, ā ā Operating lease ā Finance leases ā Operating lease ā Finance leases Amortization of ROU assets ā $ 27 ā $ 318 ā $ 53 ā $ 485 Interest expense ā ā 21 ā ā 153 ā ā 43 ā ā 288 Total ā $ 48 ā $ 471 ā $ 96 ā $ 773 ā Future minimum lease payments (undiscounted) as at June 30, 2019 are as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Payments due by period ā 2019 2020 2021 2022 2023 Thereafter Total Operating lease obligation ā $ 111 ā $ 225 ā $ 230 ā $ 232 ā $ 237 ā $ 158 ā $ 1,193 Finance lease obligations ā 1,194 ā 2,317 ā 2,362 ā 2,057 ā 105 ā ā ā ā 8,035 Total future minimum lease payments ā $ 1,305 ā $ 2,542 ā $ 2,592 ā $ 2,289 ā $ 342 ā $ 158 ā $ 9,228 Less: Imputed interest ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (1,220) Total ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ 8,008 ā |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Jun. 30, 2019 | |
LONG-TERM DEBT | NOTE 10 LONG-TERM DEBT On August 10, 2018, the Company finalized a $50.0 million senior secured three year term loan facility with Royal Capital Management Corp., an administrative agent, and the lenders party thereto (āLendersā). The loan bears interest at 9.75% per annum with interest due monthly and is secured by a lien on certain of the Companyās and its subsidiariesā assets. Scheduled minimum debt repayments commence in August 2020. Annual repayments are as follows: $10.0 million in 2020 and $40.0 million in 2021. The Company incurred and paid $1.2 million and $2.4 million in interest during the three and six months ended June 30, 2019 (June 30, 2018 ā $nil), of which $0.6 million was capitalized in plant and equipment for Gold Bar mine ( note 7 |
ASSET RETIREMENT OBLIGATIONS
ASSET RETIREMENT OBLIGATIONS | 6 Months Ended |
Jun. 30, 2019 | |
ASSET RETIREMENT OBLIGATIONS | NOTE 11 ASSET RETIREMENT OBLIGATIONS The Company is responsible for reclamation of certain past and future disturbances at its properties. The most significant properties subject to these obligations are the Gold Bar and Tonkin properties in Nevada, the El Gallo Project in Mexico, and the Timmins properties in Canada. A reconciliation of the Companyās asset retirement obligations for the six months ended June 30, 2019 and for the year ended December 31, 2018 are as follows: ā ā ā ā ā ā ā ā ā June 30, 2019 December 31, 2018 Asset retirement obligation liability, beginning balance ā $ 29,402 ā $ 24,722 Settlements ā (127) ā (392) Accretion of liability ā 800 ā 1,205 Adjustment reflecting updated estimates ā 4,304 ā 5,024 Foreign exchange revaluation ā ā 610 ā ā (1,157) Asset retirement obligation liability, ending balance ā $ 34,989 ā $ 29,402 Current portion ā ā (1,218) ā ā (734) Long-term portion ā $ 33,771 ā $ 28,668 ā The change in estimate for the six months ended June 30, 2019 includes a $4.2 million additional estimated liability for the Gold Bar mine, which relates to disturbances during the period (December 31, 2018 ā an additional $3.6 million related to disturbances that had taken place during the construction period). |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2019 | |
SHAREHOLDERS' EQUITY | NOTE 12 SHAREHOLDERSā EQUITY Equity Issuances Registered Direct Offering (the āOfferingā) On March 29, 2019, the Company issued 14,193,548 Units under the Offering at $1.55 per Unit, for net proceeds of $20.3 million (net of issuance costs of $1.7 million). Each Unit consisted of one common share and one-half of one warrant to purchase one common share at a price of $2.00, expiring three years from the date of issuance. Warrants are exercisable at any time prior to March 29, 2022. Under the same Offering, the Company issued 1,935,484 Subscription Receipts at $1.55 per Unit to certain of its executive officers, directors, employees and consultants; each Subscription Receipt entitled the holder to receive one Unit upon necessary shareholder and NYSE approvals. Upon approval on May 23, 2019, the Company issued 1,935,484 Units for net proceeds of $2.6 million (net of issuance costs of $0.3 million). All Units issued under the Offering have consistent terms. The Company concluded that both common shares and warrants are equity-linked financial instruments and should be accounted for permanently in the shareholdersā equity section in the Consolidated Balance Sheets The Company used the Black-Scholes pricing model to determine the fair value of warrants issued in connection with the Offering using the following assumptions: ā ā ā ā ā ā ā ā ā Issued on: March 29, 2019 ā May 23, 2019 Risk-free interest rate ā 2.30 % ā ā 2.14 % Dividend yield ā 0.00 % ā ā 0.00 % Volatility factor of the expected market price of common stock ā 50 % ā ā 45 % Weighted-average expected life ā 3 years ā ā ā 3 years ā Weighted-average grant date fair value $ 0.43 ā ā $ 0.22 ā ā All 8,064,516 warrants issued remain outstanding and unexercised as at June 30, 2019. Shares issued for acquisition of mineral property interest On June 11, 2018, the Company issued 178,321 shares of common stock in exchange for the acquisition of mineral interests adjacent to the Black Fox Complex. Flow-through shares On December 20, 2018, the Company issued 6,634,000 flow-through common shares (within the meaning of subsection 66(15) of the Income Tax Act (Canada) Income Tax Act (Canada) Proceeds from the flow through issuance are allocated between the sale of tax benefits as flow-through premium liability and common shares (respectively $3.0 million and $11.9 million for the 2018 issuance). The flow through premium liability is amortized as the Company incurs CEE and is recorded as income tax recovery on the Consolidated Statement of Operations Flow through share proceeds are shown as restricted cash in the Consolidated Balance Sheet At-the-market (āATMā) offering Pursuant to an equity distribution agreement dated November 8, 2018, the Company was permitted to offer and sell from time to time shares of its common stock having an aggregate offering price of up to $90.0 million, with the net proceeds to fund working capital and general corporate purposes. During the three months ended March 31, 2019, the Company issued an aggregate of 1,010,545 common shares for gross and net proceeds of $1.9 million. The Company terminated the agreement on March 13, 2019. Stock options During the six months ended June 30, 2019, the Company issued 257,500 common shares for proceeds of $0.3 million upon the exercise of same number of stock options at a weighted average exercise price of $1.01 per share. During the same period in 2018, the Company issued 39,199 commons shares for proceeds of less than $0.1 million upon the exercise of same number of stock options at a weighted average exercise price of $1.14 per share. Stock based compensation During the three and six months ended June 30, 2019, the Company recorded stock option expense of $0.1 million and $0.2 million, respectively (June 30, 2018 ā $0.2 million and $0.4 million, respectively). During the six months ended June 30, 2019, 2.6 million stock options were granted to officers, directors and certain employees at a weighted average exercise price of $1.67 per share. Shareholdersā distributions During the six months ended June 30, 2018, the Company paid a shareholdersā distribution of $0.005 per share of common stock, for a total of $1.7 million. Pursuant to the term loan facility dated August 10, 2018 ( note 10 |
NET LOSS PER SHARE
NET LOSS PER SHARE | 6 Months Ended |
Jun. 30, 2019 | |
NET LOSS PER SHARE | NOTE 13 NET LOSS PER SHARE Basic net loss per share is computed by dividing the net loss attributable to common shareholders by the weighted average number of common shares outstanding during the period. Potentially dilutive instruments are not included in the calculation of diluted net loss per share for the three and six months ended June 30, 2019 and 2018, as they would be anti-dilutive. For the six months ended June 30, 2019, 6,345,150 outstanding options and 8,064,516 outstanding warrants were excluded from the computation of diluted loss per share (June 30, 2018 ā 4,412,830 outstanding options and 10,350,000 outstanding warrants). Below is a reconciliation of the basic and diluted weighted average number of common shares outstanding and the computations for basic and diluted net loss per share for the three and six months ended June 30, 2019 and 2018: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, ā Six months ended June 30, ā 2019 2018 ā 2019 2018 ā ā (amounts in thousands, unless otherwise noted) Net loss ā $ (13,014) ā $ (5,380) ā $ (23,150) ā $ (10,591) ā ā ā ā ā ā ā ā ā ā ā ā Weighted average common shares outstanding: ā 346,998 ā 337,087 ā ā 346,095 ā ā 337,075 Diluted shares outstanding: ā 346,998 ā 337,087 ā ā 346,095 ā ā 337,075 ā ā ā ā ā ā ā ā ā ā ā ā ā Net loss per share - basic and diluted ā $ (0.04) ā $ (0.02) ā $ (0.07) ā $ (0.03) ā |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2019 | |
RELATED PARTY TRANSACTIONS | NOTE 14 RELATED PARTY TRANSACTIONS The Company recorded the following expense in respect to the related parties outlined below: ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, Six months ended June 30, ā ā 2019 2018 ā 2019 2018 Lexam L.P. ā $ 16 ā $ 18 ā $ 77 ā $ 31 REVlaw ā ā 86 ā ā 68 ā ā 128 ā ā 102 The Company has the following outstanding accounts payable balances in respect to the related parties outlined below: ā ā ā ā ā ā ā ā ā June 30, ā December 31, ā 2019 2018 Lexam L.P. ā $ 7 ā $ ā REVlaw ā ā 17 ā ā 32 ā An aircraft owned by Lexam L.P. (which is controlled by Robert R. McEwen, limited partner and beneficiary of Lexam L.P. and the Companyās Chairman and Chief Executive Officer) has been made available to the Company in order to expedite business travel. In his role as Chairman and Chief Executive Officer of the Company, Mr. McEwen must travel extensively and frequently on short notice. Mr. McEwen is able to charter the aircraft from Lexam L.P. at a preferential rate approved by the Companyās independent board members under a policy whereby only the variable expenses of operating this aircraft for business related travel are eligible for reimbursement by the Company. REVlaw is a company owned by Carmen Diges, General Counsel of the Company. The legal services of Ms. Diges as General Counsel and one other member of the legal department are provided by REVlaw in the normal course of business and have been recorded at their exchange amount. An affiliate of Mr. McEwen participated in the $50.0 million senior secured three-year term loan facility (āTerm Loanā), by providing $25.0 million of the total $50.0 million Term Loan. During the three and six months ended June 30, 2019, the Company paid interest of $0.6 million and $1.2 million, respectively, (June 30, 2018 ā $nil) to this affiliate (n ote 10). |
FAIR VALUE ACCOUNTING
FAIR VALUE ACCOUNTING | 6 Months Ended |
Jun. 30, 2019 | |
FAIR VALUE ACCOUNTING | NOTE 15 FAIR VALUE ACCOUNTING Fair value accounting establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level 1 Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and Level 3 Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). As required by accounting guidance, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Assets and liabilities measured at fair value on a recurring basis. The following table identifies the fair value of the Companyās financial assets and liabilities as reported in the Consolidated Balance Sheets ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair value as at June 30, 2019 Fair value as at December 31, 2018 ā Level 1 Level 2 Total Level 1 Level 2 Total Marketable equity securities ā $ 4,354 ā $ ā ā $ 4,354 ā $ 2,718 ā $ ā ā $ 2,718 Warrants ā ā ā ā ā 793 ā ā 793 ā ā ā ā ā 413 ā ā 413 Total investments ā $ 4,354 ā $ 793 ā $ 5,147 ā $ 2,718 ā $ 413 ā $ 3,131 ā The Company does not have any Level 3 financial liabilities. Marketable equity securities are exchange traded, and are valued based on their quoted market price at each period end. The warrants are not traded on an active market, but are valued using the Black-Scholes option pricing model, and classified within Level 2 of the fair value hierarchy. The main inputs used in the valuation of the warrants are volatility, interest rate, dividend yield and exercise price of the instruments. The fair value of other financial assets and liabilities were assumed to approximate their carrying values due to their short-term nature and historically negligible credit losses. Long-term debt is recorded at a carrying value of $49.4 million (December 31, 2018 ā $49.2 million) and is assumed to approximate its fair value due to the Company having recently acquired the debt. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2019 | |
COMMITMENTS AND CONTINGENCIES | NOTE 16 COMMITMENTS AND CONTINGENCIES In addition to the commitments disclosed in note 10 note 12 Reclamation Obligations As part of its ongoing business and operations, the Company is required to provide bonding for its environmental reclamation obligations of $20.0 million (Nevada, United States) pertaining primarily to the Tonkin and the Gold Bar properties and $15.7 million (C $20.6 million) in Canada with respect to the Black Fox Complex. In addition, under Canadian regulations, the Company was required to deposit approximately $0.1 million with respect to its Lexam properties in Timmins, which . Surety Bonds As at June 30, 2019, the Company has a surety facility in place to cover all its bonding obligations, which include $20.0 million of bonding in Nevada and $15.7 million (C$20.6 million) of bonding in Canada. The terms of the facility carry an annual financing fee of 2% and no deposit requirements. The surety bonds are available for draw down by the beneficiary in the event the Company does not perform its reclamation obligations. If the specific reclamation requirements are met, the beneficiary of the surety bonds will release the instrument to the issuing entity. The Company believes it is in compliance with all applicable bonding obligations and will be able to satisfy future bonding requirements, through existing or alternative means, as they arise. Streaming Agreement As part of the acquisition of the Black Fox Complex in 2017, the Company assumed a gold purchase agreement (streaming contract) related to production from certain claims at Black Fox. The Company is obligated to sell 8% of gold production from the Black Fox mine and 6.3% from the adjoining Pike River property (Black Fox Extension) to Sandstorm Gold Ltd. at the lesser of market price or $550 per ounce (with inflation adjustments of up to 2% per year) until 2090. The Company records the revenue from the gold stream sales based on the contract price at the time of delivery to the customer. During the three and six months ended June 30, 2019, the Company recorded revenue of $0.5 million and $0.9 million, respectively (June 30, 2018 ā $0.6 million and $1.3 million, respectively) related to the gold stream sales. |
CASH AND CASH EQUIVALENTS AND R
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | 6 Months Ended |
Jun. 30, 2019 | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | NOTE 17 CASH, CASH EQUIVALENTS AND RESTRICTED CASH The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported in the Consolidated Balance Sheets Consolidated Statements of Cash flows ā ā ā ā ā ā ā ā ā ā June 30, ā December 31, ā 2019 2018 Cash and cash equivalents ā $ 9,325 ā $ 15,756 Restricted cash (note 12) ā ā 13,112 ā ā 14,685 Restricted cash included in other assets ā ā 48 ā ā 48 Total cash, cash equivalents, and restricted cash ā $ 22,485 ā $ 30,489 ā |
OPERATING SEGMENT REPORTING (Ta
OPERATING SEGMENT REPORTING (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of the financial information relating to the Company's segments | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, 2019 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ 11,522 ā $ 16,049 ā $ 8,812 ā $ ā ā $ ā ā $ 36,383 Production costs applicable to sales ā ā (7,835) ā ā (10,639) ā ā (6,225) ā ā ā ā ā ā ā (24,699) Depreciation and depletion ā ā (2,568) ā ā (4,221) ā ā (218) ā ā ā ā ā ā ā ā (7,007) Gross profit ā ā 1,119 ā ā 1,189 ā ā 2,369 ā ā ā ā ā ā ā ā 4,677 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (390) ā ā ā ā ā (1,705) ā ā ā ā ā ā ā (2,095) Exploration ā ā (1,292) ā ā (4,062) ā ā ā ā ā ā ā ā (518) ā ā (5,872) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (4,137) ā ā ā ā (4,137) Segment (loss) income ā $ (563) ā $ (2,873) ā $ 664 ā $ (4,137) ā $ (518) ā $ (7,427) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (6,088) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (13,515) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Six months ended June 30, 2019 USA ā Canada ā ā Mexico ā ā MSC Los Azules Total Revenue from gold and silver sales ā $ 12,364 ā $ 24,992 ā $ 14,610 ā $ ā ā $ ā ā $ 51,966 Production costs applicable to sales ā ā (8,643) ā ā (16,475) ā ā (10,730) ā ā ā ā ā ā ā (35,848) Depreciation and depletion ā ā (2,720) ā ā (6,931) ā ā (362) ā ā ā ā ā ā ā ā (10,013) Gross profit ā ā 1,001 ā ā 1,586 ā ā 3,518 ā ā ā ā ā ā ā ā 6,105 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (586) ā ā ā ā ā (4,155) ā ā ā ā ā ā ā (4,741) Exploration ā ā (1,902) ā ā (6,483) ā ā ā ā ā ā ā ā (1,637) ā (10,022) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (6,447) ā ā ā ā (6,447) Segment loss ā $ (1,487) ā $ (4,897) ā $ (637) ā $ (6,447) ā $ (1,637) ā $ (15,105) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (8,428) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (23,533) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, 2018 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ ā ā $ 19,425 ā $ 14,381 ā $ ā ā $ ā ā $ 33,806 Production costs applicable to sales ā ā ā ā ā (11,981) ā ā (8,634) ā ā ā ā ā ā ā ā (20,615) Depreciation and depletion ā ā ā ā ā (3,526) ā ā (573) ā ā ā ā ā ā ā ā (4,099) Gross profit ā ā ā ā ā 3,918 ā ā 5,174 ā ā ā ā ā ā ā ā 9,092 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (1,591) ā ā ā ā ā (1,165) ā ā ā ā ā ā ā ā (2,756) Exploration ā ā (1,151) ā ā (5,788) ā ā (329) ā ā ā ā ā (2,341) ā ā (9,609) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (2,265) ā ā ā ā ā (2,265) Segment (loss) income ā $ (2,742) ā $ (1,870) ā $ 3,680 ā $ (2,265) ā $ (2,341) ā $ (5,538) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (1,982) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (7,520) ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Six months ended June 30, 2018 USA Canada Mexico MSC Los Azules Total Revenue from gold and silver sales ā $ ā ā $ 35,049 ā $ 39,798 ā $ ā ā $ ā ā $ 74,847 Production costs applicable to sales ā ā ā ā ā (22,532) ā ā (21,806) ā ā ā ā ā ā ā ā (44,338) Depreciation and depletion ā ā ā ā ā (5,784) ā ā (1,405) ā ā ā ā ā ā ā ā (7,189) Gross profit ā ā ā ā ā 6,733 ā ā 16,587 ā ā ā ā ā ā ā ā 23,320 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Advanced projects ā ā (2,633) ā ā ā ā ā (3,127) ā ā ā ā ā ā ā ā (5,760) Exploration ā ā (3,151) ā ā (11,167) ā ā (1,300) ā ā ā ā ā (5,866) ā ā (21,484) Loss from investment in Minera Santa Cruz S.A. ā ā ā ā ā ā ā ā ā ā ā (2,477) ā ā ā ā ā (2,477) Segment (loss) income ā $ (5,784) ā $ (4,434) ā $ 12,160 ā $ (2,477) ā $ (5,866) ā $ (6,401) General and Administrative and other ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (7,468) Loss before income and mining taxes ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ (13,869) |
Schedule Of Geographic Information | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Long-lived Assets ā Revenue (1) ā ā June 30, ā December 31, ā Three months ended June 30, ā Six months ended June 30, ā 2019 2018 2019 2018 ā 2019 ā 2018 Canada ā $ 85,437 ā $ 84,119 ā $ 16,049 ā $ 19,425 ā $ 24,992 ā $ 35,049 Mexico ā ā 23,783 ā ā 26,524 ā ā 8,812 ā ā 14,381 ā ā 14,610 ā ā 39,798 USA ā ā 137,974 ā ā 127,617 ā ā 11,522 ā ā ā ā ā 12,364 ā ā ā Argentina (2) ā ā 310,837 ā ā 319,305 ā ā ā ā ā ā ā ā ā ā ā ā Total consolidated ā $ 558,031 ā $ 557,565 ā $ 36,383 ā $ 33,806 ā $ 51,966 ā $ 74,847 (1) Presented based on the location from which the product originated. (2) Includes Investment in MSC of $119.3 million as of June 30, 2019 (December 31, 2018 ā $127.8 million). |
OTHER INCOME (EXPENSES) (Tables
OTHER INCOME (EXPENSES) (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
OTHER INCOME (EXPENSE) | |
Schedule of other income (expenses) | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, ā ā Six months ended June 30, ā 2019 2018 ā ā 2019 ā 2018 Unrealized and realized gain (loss) on investments (note 4) ā $ 925 ā $ (534) ā ā $ 1,752 ā $ (3,269) Foreign currency (loss) gain ā ā (537) ā ā 1,482 ā ā ā (374) ā ā 2,409 Other income ā ā 75 ā ā 373 ā ā ā 132 ā ā 617 Loss on sale of assets ā ā ā ā ā (99) ā ā ā ā ā ā (99) Total other income (expense) ā $ 463 ā $ 1,222 ā ā $ 1,510 ā $ (342) ā |
INVESTMENTS (Tables)
INVESTMENTS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Summary of investment portfolio | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions ā Net gain ā Disposals ā Unrealized ā Fair value ā ā December 31, ā during ā (loss) on ā during ā gain (loss) on ā June 30, ā 2018 period securities sold period securities held 2019 Marketable equity securities ā $ 2,718 ā $ 264 ā $ ā ā $ ā ā $ 1,372 ā $ 4,354 Warrants ā 413 ā ā ā ā ā ā ā 380 ā 793 Investments ā $ 3,131 ā $ 264 ā $ ā ā $ ā ā $ 1,752 ā $ 5,147 ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā As at ā Additions ā Net gain ā Disposals ā Unrealized ā Fair value ā ā December 31, ā during ā (loss) on ā during ā gain (loss) on ā June 30, ā 2017 period securities sold period securities held 2018 Marketable equity securities ā $ 6,404 ā $ 1,211 ā $ (767) ā $ (2,899) ā $ (1,637) ā $ 2,312 Warrants ā 1,567 ā ā ā ā ā ā ā ā (702) ā ā (865) ā ā ā Investments ā $ 7,971 ā $ 1,211 ā $ (767) ā $ (3,601) ā $ (2,502) ā $ 2,312 |
RECEIVABLES AND OTHER CURRENT_2
RECEIVABLES AND OTHER CURRENT ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
RECEIVABLES AND OTHER CURRENT ASSETS | |
Schedule of balances in receivables and other current assets | ā ā ā ā ā ā ā ā ā ā June 30, 2019 ā December 31, 2018 Trade receivable ā $ 1,294 ā $ ā Government sales tax receivable ā ā 2,128 ā ā 2,079 Other current assets ā ā 1,183 ā ā 1,686 Receivables and other current assets ā $ 4,605 ā $ 3,765 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of inventories | ā ā ā ā ā ā ā ā ā ā June 30, 2019 December 31, 2018 Material on leach pads $ 21,122 $ 10,370 ā In-process inventory ā 3,919 ā 3,446 ā Stockpiles ā 1,839 ā 1,272 ā Precious metals ā 2,404 ā 3,421 ā Materials and supplies ā 3,703 ā 3,530 ā Current inventories ā $ 32,987 ā $ 22,039 ā |
MINERAL PROPERTY INTERESTS AN_2
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
MINERAL PROPERTY INTERESTS, PLANT AND EQUIPMENT AND CONSTRUCTION IN PROGRESS | |
Schedule of property and equipment | ā ā ā ā ā ā ā ā ā ā June 30, 2019 December 31, 2018 Mineral property interests $ 340,945 $ 326,086 ā Land ā 8,708 ā 8,699 ā Construction in progress ā ā 3,901 ā ā 74,643 ā Plant and equipment ā ā 130,572 ā ā 49,578 ā Subtotal ā $ 484,126 ā $ 459,006 ā Less: accumulated depreciation ā (48,006) ā ā (35,127) ā Net carrying value ā $ 436,120 ā $ 423,879 ā |
Schedule of leased assets | ā ā ā ā ā ā ā ā ā ā ā June 30, 2019 ā ā ā Operating lease ā Finance leases ā Leased assets, cost ā $ 1,167 ā $ 8,048 ā Accumulated amortization ā ā (413) ā ā (515) ā Net book value ā $ 754 ā $ 7,533 ā ā |
INVESTMENT IN MINERA SANTA CR_2
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Summary of MSC's financial information from operations | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, ā Six months ended June 30, ā 2019 2018 2019 2018 Minera Santa Cruz S.A. ( 100% ) ā ā ā ā ā ā ā ā ā ā ā ā Revenue from gold and silver sales ā $ 62,597 ā $ 52,272 ā $ 108,800 ā $ 102,934 Production costs applicable to sales ā ā (52,896) ā ā (43,346) ā ā (89,236) ā ā (86,814) Other operating expenses ā ā (9,440) ā ā (3,553) ā ā (18,843) ā ā (7,612) Other expenses ā ā (855) ā ā (6,136) ā ā (3,298) ā ā (8,254) Net (loss) income before tax ā $ (594) ā $ (763) ā $ (2,577) ā $ 254 Current and deferred tax expense ā ā (3,049) ā ā (6,937) ā ā (3,838) ā ā (7,076) Net loss ā $ (3,643) ā $ (7,700) ā $ (6,415) ā $ (6,822) ā ā ā ā ā ā ā ā ā ā ā ā ā Portion attributable to McEwen Mining Inc. ( 49% ) ā ā ā ā ā ā ā ā ā ā ā ā Net loss ā $ (1,784) ā $ (3,773) ā $ (3,142) ā $ (3,343) Amortization of fair value increments ā (2,459) ā (2,482) ā (4,372) ā (4,597) Income tax recovery ā ā 106 ā ā 3,990 ā ā 1,067 ā ā 5,463 Loss from investment in MSC, net of amortization ā $ (4,137) ā $ (2,265) ā $ (6,447) ā $ (2,477) |
Schedule of change in the entity's investment in MSC | ā ā ā ā ā ā ā ā ā June 30, 2019 December 31, 2018 Investment in MSC, beginning of period ā $ 127,814 ā $ 150,064 Attributable net loss from MSC ā ā (3,142) ā ā (10,065) Amortization of fair value increments ā (4,372) ā (9,730) Income tax recovery ā ā 1,067 ā ā 7,930 Dividend distribution received ā (2,020) ā (10,385) Investment in MSC, end of period ā $ 119,347 ā $ 127,814 |
Summary of key assets and liabilities, before and after adjustments to fair value | ā ā ā ā ā ā ā ā ā ā ā As at June 30, 2019 ā Balance excluding FV increments ā Adjustments ā Balance including FV increments Current assets ā $ 71,226 ā $ 341 ā $ 71,567 Total assets ā ā 190,935 ā ā 129,493 ā ā 320,428 ā ā ā ā ā ā ā ā ā ā Current liabilities ā $ (38,675) ā $ ā ā $ (38,675) Total liabilities ā ā (67,110) ā ā (9,754) ā ā (76,864) ā |
LEASE LIABILITIES (Tables)
LEASE LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
LEASE LIABILITIES | |
Schedule of lease liabilities | ā ā ā ā ā ā ā ā ā ā Total discounted lease liabilities ā ā June 30, 2019 ā December 31, 2018 Finance leases ā $ 7,039 ā ā 6,429 Operating lease ā ā 969 ā $ ā Lease liabilities ā $ 8,008 ā $ 6,429 Current portion ā ā (2,007) ā ā (1,511) Long-term portion ā $ 6,001 ā $ 4,918 |
Schedule of lease costs | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, ā Six months ended June 30, ā ā Operating lease ā Finance leases ā Operating lease ā Finance leases Amortization of ROU assets ā $ 27 ā $ 318 ā $ 53 ā $ 485 Interest expense ā ā 21 ā ā 153 ā ā 43 ā ā 288 Total ā $ 48 ā $ 471 ā $ 96 ā $ 773 |
Schedule of undiscounted lease payment obligations, operating lease | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Payments due by period ā 2019 2020 2021 2022 2023 Thereafter Total Operating lease obligation ā $ 111 ā $ 225 ā $ 230 ā $ 232 ā $ 237 ā $ 158 ā $ 1,193 Finance lease obligations ā 1,194 ā 2,317 ā 2,362 ā 2,057 ā 105 ā ā ā ā 8,035 Total future minimum lease payments ā $ 1,305 ā $ 2,542 ā $ 2,592 ā $ 2,289 ā $ 342 ā $ 158 ā $ 9,228 Less: Imputed interest ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (1,220) Total ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ 8,008 ā |
Schedule of undiscounted lease payment obligations, finance lease | Future minimum lease payments (undiscounted) as at June 30, 2019 are as follows: ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Payments due by period ā 2019 2020 2021 2022 2023 Thereafter Total Operating lease obligation ā $ 111 ā $ 225 ā $ 230 ā $ 232 ā $ 237 ā $ 158 ā $ 1,193 Finance lease obligations ā 1,194 ā 2,317 ā 2,362 ā 2,057 ā 105 ā ā ā ā 8,035 Total future minimum lease payments ā $ 1,305 ā $ 2,542 ā $ 2,592 ā $ 2,289 ā $ 342 ā $ 158 ā $ 9,228 Less: Imputed interest ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā (1,220) Total ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā $ 8,008 ā |
ASSET RETIREMENT OBLIGATIONS (T
ASSET RETIREMENT OBLIGATIONS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of reconciliation of asset retirement obligations | ā ā ā ā ā ā ā ā ā June 30, 2019 December 31, 2018 Asset retirement obligation liability, beginning balance ā $ 29,402 ā $ 24,722 Settlements ā (127) ā (392) Accretion of liability ā 800 ā 1,205 Adjustment reflecting updated estimates ā 4,304 ā 5,024 Foreign exchange revaluation ā ā 610 ā ā (1,157) Asset retirement obligation liability, ending balance ā $ 34,989 ā $ 29,402 Current portion ā ā (1,218) ā ā (734) Long-term portion ā $ 33,771 ā $ 28,668 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of Black-Scholes pricing model to determine the fair value of warrants | ā ā ā ā ā ā ā ā ā Issued on: March 29, 2019 ā May 23, 2019 Risk-free interest rate ā 2.30 % ā ā 2.14 % Dividend yield ā 0.00 % ā ā 0.00 % Volatility factor of the expected market price of common stock ā 50 % ā ā 45 % Weighted-average expected life ā 3 years ā ā ā 3 years ā Weighted-average grant date fair value $ 0.43 ā ā $ 0.22 ā |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of reconciliation of the basic weighted average number of common shares and the computations for basic loss per share | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, ā Six months ended June 30, ā 2019 2018 ā 2019 2018 ā ā (amounts in thousands, unless otherwise noted) Net loss ā $ (13,014) ā $ (5,380) ā $ (23,150) ā $ (10,591) ā ā ā ā ā ā ā ā ā ā ā ā Weighted average common shares outstanding: ā 346,998 ā 337,087 ā ā 346,095 ā ā 337,075 Diluted shares outstanding: ā 346,998 ā 337,087 ā ā 346,095 ā ā 337,075 ā ā ā ā ā ā ā ā ā ā ā ā ā Net loss per share - basic and diluted ā $ (0.04) ā $ (0.02) ā $ (0.07) ā $ (0.03) ā |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of related party expense (income) and outstanding accounts payable (receivable) | The Company recorded the following expense in respect to the related parties outlined below: ā ā ā ā ā ā ā ā ā ā ā ā ā ā Three months ended June 30, Six months ended June 30, ā ā 2019 2018 ā 2019 2018 Lexam L.P. ā $ 16 ā $ 18 ā $ 77 ā $ 31 REVlaw ā ā 86 ā ā 68 ā ā 128 ā ā 102 The Company has the following outstanding accounts payable balances in respect to the related parties outlined below: ā ā ā ā ā ā ā ā ā June 30, ā December 31, ā 2019 2018 Lexam L.P. ā $ 7 ā $ ā REVlaw ā ā 17 ā ā 32 |
FAIR VALUE ACCOUNTING (Tables)
FAIR VALUE ACCOUNTING (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Schedule of assets and liabilities measured at fair value on a recurring basis by level within the fair value hierarchy | ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā ā Fair value as at June 30, 2019 Fair value as at December 31, 2018 ā Level 1 Level 2 Total Level 1 Level 2 Total Marketable equity securities ā $ 4,354 ā $ ā ā $ 4,354 ā $ 2,718 ā $ ā ā $ 2,718 Warrants ā ā ā ā ā 793 ā ā 793 ā ā ā ā ā 413 ā ā 413 Total investments ā $ 4,354 ā $ 793 ā $ 5,147 ā $ 2,718 ā $ 413 ā $ 3,131 |
CASH AND CASH EQUIVALENTS AND_2
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | |
Reconciliation of cash, cash equivalents, and restricted cash | ā ā ā ā ā ā ā ā ā ā June 30, ā December 31, ā 2019 2018 Cash and cash equivalents ā $ 9,325 ā $ 15,756 Restricted cash (note 12) ā ā 13,112 ā ā 14,685 Restricted cash included in other assets ā ā 48 ā ā 48 Total cash, cash equivalents, and restricted cash ā $ 22,485 ā $ 30,489 ā |
NATURE OF OPERATIONS AND RECE_2
NATURE OF OPERATIONS AND RECENT ACCOUNTING PRONOUNCEMENTS (Details) | 6 Months Ended |
Jun. 30, 2019 | |
Lease, Practical Expedients, Package [true false] | true |
Lease, Practical Expedient, Use of Hindsight [true false] | true |
Lease Practical Expedient Land Easement | true |
MSC | |
Ownership interest (as a percent) | 49.00% |
OPERATING SEGMENT REPORTING (De
OPERATING SEGMENT REPORTING (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating Segment Reporting | ||||||
Revenue from gold and silver sales | $ 36,383 | $ 33,806 | $ 51,966 | $ 74,847 | ||
Revision of estimates and accretion of reclamation obligations | (427) | (288) | (888) | (582) | ||
Depreciation and depletion | (7,007) | (4,099) | (10,013) | (7,189) | ||
Loss from investment in Minera Santa Cruz S.A. | (4,137) | (2,265) | (6,447) | (2,477) | ||
Advanced projects | (2,095) | (2,756) | (4,741) | (5,760) | ||
Segment income (loss) | (7,427) | (5,538) | (15,105) | (6,401) | ||
General and Administrative and other | (6,088) | (1,982) | (8,428) | (7,468) | ||
Gross profit | 4,677 | 9,092 | 6,105 | 23,320 | ||
Interest and other expense | (2,783) | 354 | (3,296) | 220 | ||
Revision of estimates and accretion of reclamation obligations | (427) | (288) | (888) | (582) | ||
Foreign currency (loss) gain | (537) | 1,482 | (374) | 2,409 | ||
Net (loss) income before tax | (13,515) | (7,520) | (23,533) | (13,869) | ||
Long-Lived Assets | 558,031 | 558,031 | $ 557,565 | |||
Investment in MSC | 119,347 | 119,347 | 127,814 | |||
Mexico | ||||||
Operating Segment Reporting | ||||||
Depreciation and depletion | (218) | (573) | (362) | (1,405) | ||
Advanced projects | (1,705) | (1,165) | (4,155) | (3,127) | ||
Segment income (loss) | 664 | 3,680 | (637) | 12,160 | ||
Gross profit | 2,369 | 5,174 | 3,518 | 16,587 | ||
MSC | ||||||
Operating Segment Reporting | ||||||
Loss from investment in Minera Santa Cruz S.A. | (4,137) | (2,265) | (6,447) | (2,477) | ||
Segment income (loss) | (4,137) | (2,265) | (6,447) | (2,477) | ||
Los Azules | ||||||
Operating Segment Reporting | ||||||
Segment income (loss) | (518) | (2,341) | (1,637) | (5,866) | ||
U.S. | ||||||
Operating Segment Reporting | ||||||
Depreciation and depletion | (2,568) | (2,720) | ||||
Advanced projects | (390) | (1,591) | (586) | (2,633) | ||
Segment income (loss) | (563) | (2,742) | (1,487) | (5,784) | ||
Gross profit | 1,119 | 1,001 | ||||
Canada | ||||||
Operating Segment Reporting | ||||||
Depreciation and depletion | (4,221) | (3,526) | (6,931) | (5,784) | ||
Segment income (loss) | (2,873) | (1,870) | (4,897) | (4,434) | ||
Gross profit | 1,189 | 3,918 | 1,586 | 6,733 | ||
MSC | ||||||
Operating Segment Reporting | ||||||
Loss from investment in Minera Santa Cruz S.A. | (4,137) | (2,265) | (6,447) | (2,477) | ||
Investment in MSC | 119,347 | 119,347 | 127,814 | $ 150,064 | ||
Canada | ||||||
Operating Segment Reporting | ||||||
Revenue from gold and silver sales | 16,049 | 19,425 | 24,992 | 35,049 | ||
Long-Lived Assets | 85,437 | 85,437 | 84,119 | |||
Mexico | ||||||
Operating Segment Reporting | ||||||
Revenue from gold and silver sales | 8,812 | 14,381 | 14,610 | 39,798 | ||
Long-Lived Assets | 23,783 | 23,783 | 26,524 | |||
United States | ||||||
Operating Segment Reporting | ||||||
Revenue from gold and silver sales | 11,522 | 12,364 | ||||
Long-Lived Assets | 137,974 | 137,974 | 127,617 | |||
Argentina | ||||||
Operating Segment Reporting | ||||||
Long-Lived Assets | 310,837 | 310,837 | 319,305 | |||
Argentina | MSC | ||||||
Operating Segment Reporting | ||||||
Investment in MSC | 119,300 | 119,300 | $ 127,800 | |||
Gold and silver sales | ||||||
Operating Segment Reporting | ||||||
Revenue from gold and silver sales | 36,383 | 33,806 | 51,966 | 74,847 | ||
Gold and silver sales | Mexico | ||||||
Operating Segment Reporting | ||||||
Revenue from gold and silver sales | 8,812 | 14,381 | 14,610 | 39,798 | ||
Gold and silver sales | U.S. | ||||||
Operating Segment Reporting | ||||||
Revenue from gold and silver sales | 11,522 | 12,364 | ||||
Gold and silver sales | Canada | ||||||
Operating Segment Reporting | ||||||
Revenue from gold and silver sales | 16,049 | 19,425 | 24,992 | 35,049 | ||
Production costs applicable to sales | ||||||
Operating Segment Reporting | ||||||
Production costs applicable to sales | (24,699) | (20,615) | (35,848) | (44,338) | ||
Production costs applicable to sales | Mexico | ||||||
Operating Segment Reporting | ||||||
Production costs applicable to sales | (6,225) | (8,634) | (10,730) | (21,806) | ||
Production costs applicable to sales | U.S. | ||||||
Operating Segment Reporting | ||||||
Production costs applicable to sales | (7,835) | (8,643) | ||||
Production costs applicable to sales | Canada | ||||||
Operating Segment Reporting | ||||||
Production costs applicable to sales | (10,639) | (11,981) | (16,475) | (22,532) | ||
Exploration | ||||||
Operating Segment Reporting | ||||||
Production costs applicable to sales | (5,872) | (9,609) | (10,022) | (21,484) | ||
Exploration | Mexico | ||||||
Operating Segment Reporting | ||||||
Production costs applicable to sales | (329) | (1,300) | ||||
Exploration | Los Azules | ||||||
Operating Segment Reporting | ||||||
Production costs applicable to sales | (518) | (2,341) | (1,637) | (5,866) | ||
Exploration | U.S. | ||||||
Operating Segment Reporting | ||||||
Production costs applicable to sales | (1,292) | (1,151) | (1,902) | (3,151) | ||
Exploration | Canada | ||||||
Operating Segment Reporting | ||||||
Production costs applicable to sales | $ (4,062) | $ (5,788) | $ (6,483) | $ (11,167) |
OPERATING SEGMENT REPORTING - G
OPERATING SEGMENT REPORTING - Geographic information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Operating Segment Reporting | |||||
Revenue | $ 36,383 | $ 33,806 | $ 51,966 | $ 74,847 | |
Long-lived Assets | 558,031 | 558,031 | $ 557,565 | ||
Investment in MSC | 119,347 | 119,347 | 127,814 | ||
Canada | |||||
Operating Segment Reporting | |||||
Revenue | 16,049 | 19,425 | 24,992 | 35,049 | |
Long-lived Assets | 85,437 | 85,437 | 84,119 | ||
Mexico | |||||
Operating Segment Reporting | |||||
Revenue | 8,812 | $ 14,381 | 14,610 | $ 39,798 | |
Long-lived Assets | 23,783 | 23,783 | 26,524 | ||
United States | |||||
Operating Segment Reporting | |||||
Revenue | 11,522 | 12,364 | |||
Long-lived Assets | 137,974 | 137,974 | 127,617 | ||
Argentina | |||||
Operating Segment Reporting | |||||
Long-lived Assets | $ 310,837 | $ 310,837 | $ 319,305 |
OTHER INCOME (EXPENSES) (Detail
OTHER INCOME (EXPENSES) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
OTHER INCOME (EXPENSE) | ||||
Unrealized and realized gain (loss) on investments (note 4) | $ 925 | $ (534) | $ 1,752 | $ (3,269) |
Foreign currency (loss) gain | (537) | 1,482 | (374) | 2,409 |
Other income | 75 | 373 | 132 | 617 |
Loss on sale of assets | (99) | (99) | ||
Total other income (expense) | $ 463 | $ 1,222 | $ 1,510 | $ (342) |
INVESTMENTS (Details)
INVESTMENTS (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | Mar. 29, 2019 | Dec. 20, 2018 | Dec. 19, 2017 | |
Investments rollforward | ||||||||
Opening balance | $ 3,131 | $ 7,971 | $ 7,971 | |||||
Additions during the period | 264 | 1,211 | ||||||
Net gain (loss) on securities sold | (767) | |||||||
Disposals during period | (3,601) | |||||||
Unrealized gains (loss) on securities held | $ 900 | $ (500) | 1,752 | (2,502) | ||||
Fair Value end of the period | 5,147 | 2,312 | 5,147 | 2,312 | 3,131 | |||
Fair value of warrants | ||||||||
Proceeds from sale of investments | 3,667 | |||||||
Cost of purchase of marketable equity securities | 3,100 | 2,900 | ||||||
Price per unit | $ 1.55 | |||||||
Flow Through Common Shares | ||||||||
Fair value of warrants | ||||||||
Price per unit | $ 2.24 | $ 2.50 | ||||||
Marketable equity securities | ||||||||
Investments rollforward | ||||||||
Opening balance | 2,718 | 6,404 | 6,404 | |||||
Additions during the period | 264 | 1,211 | ||||||
Net gain (loss) on securities sold | (767) | |||||||
Disposals during period | (2,899) | |||||||
Unrealized gains (loss) on securities held | 700 | 1,372 | (1,637) | |||||
Fair Value end of the period | 4,354 | 2,312 | 4,354 | 2,312 | 2,718 | |||
Fair value of warrants | ||||||||
Proceeds from sale of investments | $ 200 | |||||||
Warrants | ||||||||
Investments rollforward | ||||||||
Opening balance | 413 | 1,567 | 1,567 | |||||
Disposals during period | (702) | |||||||
Unrealized gains (loss) on securities held | 380 | $ (865) | ||||||
Unrealized gains (loss) on warrants | 200 | |||||||
Fair Value end of the period | $ 793 | $ 793 | $ 413 |
RECEIVABLES AND OTHER CURRENT_3
RECEIVABLES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Tax Credit Carryforward [Line Items] | |||
Trade receivable | $ 1,294 | ||
Government sales tax receivable | 2,128 | $ 2,079 | |
Other current assets | 1,183 | 1,686 | |
Receivables and other current assets | 4,605 | 3,765 | |
VAT collected | 1,000 | $ 2,900 | |
Mexican Tax Authority | |||
Tax Credit Carryforward [Line Items] | |||
Government sales tax receivable | $ 1,100 | $ 1,100 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Inventories | ||
Material on leach pads | $ 21,122 | $ 10,370 |
In-process inventory | 3,919 | 3,446 |
Stockpiles | 1,839 | 1,272 |
Precious metals | 2,404 | 3,421 |
Materials and supplies | 3,703 | 3,530 |
Current Inventories | 32,987 | 22,039 |
Other assets | ||
Inventories | ||
Non-current portion of ore on leach pads | $ 1,800 | $ 4,600 |
MINERAL PROPERTY INTERESTS AN_3
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | ||
Subtotal | $ 484,126 | $ 459,006 |
Less: accumulated depreciation | (48,006) | (35,127) |
Net carrying value | 436,120 | 423,879 |
Mineral property interests | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 340,945 | 326,086 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 8,708 | 8,699 |
Construction in process | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 3,901 | 74,643 |
Plant and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 130,572 | 49,578 |
Operating Leases | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 1,167 | |
Less: accumulated depreciation | (413) | |
Net carrying value | 754 | |
Finance Leases | ||
Property, Plant and Equipment [Line Items] | ||
Subtotal | 8,048 | |
Less: accumulated depreciation | (515) | |
Net carrying value | 7,533 | |
Gold Bar mine | Construction in process | ||
Interest expense | ||
Interest Expense, Debt | $ 1,400 | $ 800 |
MINERAL PROPERTY INTERESTS AN_4
MINERAL PROPERTY INTERESTS AND PLANT AND EQUIPMENT - Leased Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Property, Plant and Equipment [Line Items] | ||
Leased asset, cost | $ 484,126 | $ 459,006 |
Accumulated amortization | (48,006) | (35,127) |
Net book value | 436,120 | $ 423,879 |
Operating Leases | ||
Property, Plant and Equipment [Line Items] | ||
Leased asset, cost | 1,167 | |
Accumulated amortization | (413) | |
Net book value | 754 | |
Finance Leases | ||
Property, Plant and Equipment [Line Items] | ||
Leased asset, cost | 8,048 | |
Accumulated amortization | (515) | |
Net book value | $ 7,533 |
INVESTMENT IN MINERA SANTA CR_3
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Summary of Operating Results from MSC (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Revenue from gold and silver sales | $ 36,383 | $ 33,806 | $ 51,966 | $ 74,847 | |
Other operating expenses | (15,872) | (18,188) | (27,852) | (37,067) | |
Net (loss) income before tax | (13,515) | (7,520) | (23,533) | (13,869) | |
Net loss | (13,014) | (5,380) | (23,150) | (10,591) | |
Income tax recovery | (501) | (2,140) | (383) | (3,278) | |
(Loss) from investment in MSC, net of amortization | (4,137) | (2,265) | (6,447) | (2,477) | |
Dividends received | 7,200 | ||||
MSC | |||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Net loss | (1,784) | (3,773) | (3,142) | (3,343) | $ (10,065) |
Amortization of fair value increments | (2,459) | (2,482) | (4,372) | (4,597) | (9,730) |
Income tax recovery | $ 106 | 3,990 | $ 1,067 | 5,463 | $ 7,930 |
Ownership interest (as a percent) | 49.00% | 49.00% | |||
(Loss) from investment in MSC, net of amortization | $ (4,137) | (2,265) | $ (6,447) | (2,477) | |
Dividends received | 2,400 | 2,000 | |||
MSC | |||||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | |||||
Revenue from gold and silver sales | 62,597 | 52,272 | 108,800 | 102,934 | |
Production costs applicable to sales | (52,896) | (43,346) | (89,236) | (86,814) | |
Other operating expenses | (9,440) | (3,553) | (18,843) | (7,612) | |
Other expenses | (855) | (6,136) | (3,298) | (8,254) | |
Net (loss) income before tax | (594) | (763) | (2,577) | 254 | |
Current and deferred tax expense | (3,049) | (6,937) | (3,838) | (7,076) | |
Net loss | $ (3,643) | $ (7,700) | $ (6,415) | $ (6,822) | |
Summarized key financial information (as a percent) | 100.00% |
INVESTMENT IN MINERA SANTA CR_4
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Changes in Company's Investment in MSC (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Change in the investment in MSC | |||||
Investment in MSC, beginning of period | $ 127,814 | ||||
Income tax recovery | $ (501) | $ (2,140) | (383) | $ (3,278) | |
Dividend distribution received | (2,020) | (7,231) | |||
Investment in MSC, end of period | 119,347 | 119,347 | $ 127,814 | ||
MSC | |||||
Change in the investment in MSC | |||||
Investment in MSC, beginning of period | 127,814 | 150,064 | 150,064 | ||
Attributable net loss from MSC | (1,784) | (3,773) | (3,142) | (3,343) | (10,065) |
Amortization of fair value increments | (2,459) | (2,482) | (4,372) | (4,597) | (9,730) |
Income tax recovery | 106 | $ 3,990 | 1,067 | $ 5,463 | 7,930 |
Dividend distribution received | (2,020) | (10,385) | |||
Investment in MSC, end of period | $ 119,347 | $ 119,347 | $ 127,814 |
INVESTMENT IN MINERA SANTA CR_5
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE - Assets and Liabilities Associated with MSC (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | $ 65,176 | $ 59,376 |
Total assets | 623,207 | 616,941 |
Current liabilities | (34,295) | (36,012) |
Total liabilities | (135,193) | $ (130,995) |
Balance excluding FV increments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 71,226 | |
Total assets | 190,935 | |
Current liabilities | (38,675) | |
Total liabilities | (67,110) | |
Adjustments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 341 | |
Total assets | 129,493 | |
Total liabilities | (9,754) | |
Balance including FV increments | MSC | ||
INVESTMENT IN MINERA SANTA CRUZ S.A. ("MSC") - SAN JOSE MINE | ||
Current assets | 71,567 | |
Total assets | 320,428 | |
Current liabilities | (38,675) | |
Total liabilities | $ (76,864) |
LEASE LIABILITIES (Details)
LEASE LIABILITIES (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
LEASE LIABILITIES | ||
Finance leases | $ 7,039 | $ 6,429 |
Operating lease | 969 | |
Lease liabilities | 8,008 | 6,429 |
Current portion | 2,007 | 1,511 |
Long term portion | $ 6,001 | $ 4,918 |
Operating lease, Weighted average discount rate (as a percent) | 8.73% | |
Finance leases, Weighted average discount rate (as a percent) | 7.32% | |
Operating lease, Weighted average remaining lease term | 5 years | |
Finance leases, Weighted average remaining lease term | 3 years |
LEASE LIABILITIES - Lease Cost
LEASE LIABILITIES - Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | |
Lease cost | ||
Amortization of ROU assets | $ 27 | $ 53 |
Operating Lease Interest Expense | 21 | 43 |
Total | 48 | 96 |
Amortization of ROU assets | 318 | 485 |
Interest expense | 153 | 288 |
Total | $ 471 | $ 773 |
LEASE LIABILITIES - Maturity (D
LEASE LIABILITIES - Maturity (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Operating lease obligations | ||
2019 | $ 111 | |
2020 | 225 | |
2021 | 230 | |
2022 | 232 | |
2023 | 237 | |
Thereafter | 158 | |
Total | 1,193 | |
Finance lease obligations | ||
2019 | 1,194 | |
2020 | 2,317 | |
2021 | 2,362 | |
2022 | 2,057 | |
2023 | 105 | |
Total | 8,035 | |
Lease obligations | ||
2019 | 1,305 | |
2020 | 2,542 | |
2021 | 2,592 | |
2022 | 2,289 | |
2023 | 342 | |
Thereafter | 158 | |
Total | 9,228 | |
Less: Imputed interest | (1,220) | |
Total | $ 8,008 | $ 6,429 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) - USD ($) $ in Millions | Aug. 10, 2018 | Jun. 30, 2019 | Jun. 30, 2019 | Jun. 30, 2018 |
Scheduled minimum interest payments | ||||
2019 | $ 2.5 | $ 2.5 | ||
2020 | 4.7 | 4.7 | ||
2021 | 2 | 2 | ||
Affiliate of Robert McEwen | ||||
LONG-TERM DEBT | ||||
Debt interest expense | 0.6 | 1.2 | ||
Term Loan | ||||
LONG-TERM DEBT | ||||
Face amount | $ 50 | |||
Term of debt instrument | 3 years | |||
Interest Expense | 1.2 | 2.4 | ||
Interest costs capitalized | 0.6 | |||
Term Loan | Gold Bar Complex | ||||
LONG-TERM DEBT | ||||
Stated interest rate (as a percent) | 9.75% | |||
Scheduled minimum debt repayments | ||||
2020 | 10 | 10 | ||
2021 | $ 40 | $ 40 |
ASSET RETIREMENT OBLIGATIONS (D
ASSET RETIREMENT OBLIGATIONS (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Changes in the asset retirement obligations | ||
Asset retirement obligation, beginning of the period | $ 29,402 | $ 24,722 |
Settlements | (127) | (392) |
Accretion of liability | 800 | 1,205 |
Adjustment reflecting updated estimates | 4,304 | 5,024 |
Foreign exchange revaluation | 610 | (1,157) |
Asset retirement obligation, ending balance | 34,989 | 29,402 |
Current portion | (1,218) | (734) |
Non-current portion | 33,771 | 28,668 |
Gold Bar mine | ||
Changes in the asset retirement obligations | ||
Adjustment reflecting updated estimates | $ 4,200 | $ 3,600 |
SHAREHOLDERS' EQUITY (Details)
SHAREHOLDERS' EQUITY (Details) $ / shares in Units, $ in Millions | May 23, 2019USD ($)shares | Mar. 29, 2019USD ($)$ / sharesshares | Dec. 20, 2018CAD ($) | Dec. 20, 2018USD ($)$ / sharesshares | Nov. 08, 2018USD ($) | Dec. 19, 2017CAD ($) | Dec. 19, 2017USD ($)$ / sharesshares | Jun. 30, 2019USD ($)shares | Mar. 31, 2019USD ($)shares | Jun. 30, 2018USD ($)shares | Jun. 30, 2019CAD ($)shares | Jun. 30, 2019USD ($)$ / sharesshares | Jun. 30, 2018CAD ($)shares | Jun. 30, 2018USD ($)$ / sharesshares | Dec. 31, 2018USD ($)shares | Jun. 11, 2018shares |
Shareholders' distributions | $ 1,686,000 | |||||||||||||||
Semi-annual shareholders' distribution | $ / shares | 0.005 | |||||||||||||||
Common stock issued | shares | 361,957,000 | 361,957,000 | 344,560,000 | |||||||||||||
Weighted average exercise price of stock options (in dollars per share) | $ / shares | $ 1.01 | $ 1.14 | ||||||||||||||
Shares of common stock issued upon exercise of stock options | shares | 257,500 | 257,500 | 39,199 | 39,199 | ||||||||||||
Exercise of stock options | $ 37,000 | $ 5,000 | $ 260,000 | $ 45,000 | ||||||||||||
Proceeds from exercise of stock options | 260,000 | 45,000 | ||||||||||||||
Stock-based compensation | 136,000 | 193,000 | 197,000 | 396,000 | ||||||||||||
Stock options granted | 2,600,000 | |||||||||||||||
Restricted cash | 13,112,000 | 13,112,000 | $ 14,685,000 | |||||||||||||
Number of units issued | shares | 1,935,484 | 14,193,548 | ||||||||||||||
Price per unit | $ / shares | $ 1.55 | |||||||||||||||
Net proceeds | $ 20,300,000 | 22,900,000 | ||||||||||||||
Issuance costs | $ 300,000 | $ 1,700,000 | ||||||||||||||
Flow-through share premium received | 2,344,000 | 2,344,000 | 2,950,000 | |||||||||||||
Number of warrants received for each share of common stock share sold | shares | 0.50 | |||||||||||||||
Number of common share per warrant | shares | 1 | |||||||||||||||
Outstanding warrants | 8,064,516 | $ 10,350,000 | 8,064,516 | 10,350,000 | ||||||||||||
Warrants issued in connection with registered direct offering (note 8) | $ 2,634,000 | $ 2,634,000 | ||||||||||||||
Black Fox | ||||||||||||||||
Common stock issued | shares | 178,321 | |||||||||||||||
Maximum | ||||||||||||||||
Proceeds from exercise of stock options | 100,000 | |||||||||||||||
Officers, directors and certain employees | ||||||||||||||||
Weighted average exercise price of stock options (in dollars per share) | $ / shares | $ 1.67 | |||||||||||||||
Common Stock | ||||||||||||||||
Shareholders' distributions | $ 1,686,000 | |||||||||||||||
Shares of common stock issued upon exercise of stock options | shares | 36,000 | 4,000 | 258,000 | 258,000 | 39,000 | 39,000 | ||||||||||
Exercise of stock options | $ 37,000 | $ 5,000 | $ 260,000 | $ 45,000 | ||||||||||||
Stock-based compensation | 136,000 | $ 193,000 | 197,000 | $ 396,000 | ||||||||||||
Net proceeds | 20,300,000 | |||||||||||||||
Shares of common stock issued as payment for mining concessions in Mexico | shares | 178,000 | 178,000 | 178,000 | |||||||||||||
Warrants | ||||||||||||||||
Net proceeds | 2,600,000 | |||||||||||||||
Number of common share per warrant | shares | 1 | |||||||||||||||
Price per common share for each warrant | $ / shares | $ 2 | |||||||||||||||
Warrants Expiration Term | 3 years | |||||||||||||||
Subscription Receipts | ||||||||||||||||
Number of units issued | shares | 1,935,484 | |||||||||||||||
Price per unit | $ / shares | $ 1.55 | |||||||||||||||
Net proceeds | $ 2,600,000 | |||||||||||||||
Number of units received upon necessary shareholder and NYSE approvals | shares | 1 | |||||||||||||||
Flow Through Common Shares | ||||||||||||||||
Common stock issued | shares | 6,634,000 | 4,000,000 | ||||||||||||||
Restricted cash for exploration activities | $ 17.1 | 13,100,000 | ||||||||||||||
Price per unit | $ / shares | $ 2.24 | $ 2.50 | ||||||||||||||
Net proceeds | $ 20 | $ 14,900,000 | $ 12.9 | $ 10,000,000 | ||||||||||||
Flow-through share premium received | $ 3,000,000 | $ 3,000,000 | $ 11,900,000 | |||||||||||||
Flow-through share recovery of premium | $ 600,000 | $ 1,300,000 | 600,000 | 1,300,000 | ||||||||||||
Flow through expenditure incurred | $ 4.6 | 3,500,000 | $ 10.5 | $ 8,100,000 | ||||||||||||
ATM offering | ||||||||||||||||
Common stock issued | shares | 1,010,545 | |||||||||||||||
Sale of common stock for cash, net of issuance costs | 1,851,000 | |||||||||||||||
Aggregate offering price | $ 90,000,000 | |||||||||||||||
Net proceeds | $ 1,900,000 | $ 1,851,000 | ||||||||||||||
ATM offering | Common Stock | ||||||||||||||||
Number of units issued | shares | 1,010,000 | 1,010,000 | ||||||||||||||
Net proceeds | $ 1,851,000 |
SHAREHOLDERS' EQUITY - Black-Sc
SHAREHOLDERS' EQUITY - Black-Scholes pricing model (Details) - Warrants - $ / shares | May 23, 2019 | Mar. 29, 2019 |
Principal assumptions used in applying the Black-Scholes option pricing model for the awards | ||
Risk-free interest rate (as a percent) | 2.14% | 2.30% |
Dividend yield (as a percent) | 0.00% | 0.00% |
Volatility factor of the expected market price of common stock (as a percent) | 45.00% | 50.00% |
Weighted-average expected life of option | 3 years | 3 years |
Weighted-average grant date fair value (in dollars per share) | $ 0.22 | $ 0.43 |
NET LOSS PER SHARE (Details)
NET LOSS PER SHARE (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Outstanding options | 6,345,150 | 4,412,830 | 6,345,150 | 4,412,830 |
Outstanding warrants | $ 8,064,516 | $ 10,350,000 | $ 8,064,516 | $ 10,350,000 |
Net loss | $ (13,014,000) | $ (5,380,000) | $ (23,150,000) | $ (10,591,000) |
Weighted average common shares outstanding: | 346,998,000 | 337,087,000 | 346,095,000 | 337,075,000 |
Diluted shares outstanding: | 346,998,000 | 337,087,000 | 346,095,000 | 337,075,000 |
Net loss per share: | ||||
Basic and Diluted (in dollars per share) | $ (0.04) | $ (0.02) | $ (0.07) | $ (0.03) |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands | Aug. 10, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 |
RELATED PARTY TRANSACTIONS | ||||||
Accounts payable | $ 28,726 | $ 28,726 | $ 30,817 | |||
Long-term debt from related party (note 18) | 24,678 | 24,678 | 24,603 | |||
Term Loan | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Face amount | $ 50,000 | |||||
Debt Instrument Term | 3 years | |||||
Robert McEwen | Term Loan | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Long-term debt from related party (note 18) | $ 25,000 | |||||
Affiliate of Robert McEwen | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Debt interest expense | 600 | 1,200 | ||||
Entity Affiliated With Related Party | Lexam L.P. | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Expense (income) | 16 | $ 18 | 77 | 31 | ||
Related party outstanding accounts payable | 7 | 7 | ||||
Entity Affiliated With Related Party | REVlaw | ||||||
RELATED PARTY TRANSACTIONS | ||||||
Expense (income) | 86 | $ 68 | 128 | $ 102 | ||
Related party outstanding accounts payable | $ 17 | $ 17 | $ 32 |
FAIR VALUE ACCOUNTING (Details)
FAIR VALUE ACCOUNTING (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Liabilities: | ||
Long term debt | $ 49,400 | $ 49,200 |
Recurring | ||
Assets: | ||
Investments | 5,147 | 3,131 |
Recurring | Level 1 | ||
Assets: | ||
Investments | 4,354 | 2,718 |
Recurring | Level 2 | ||
Assets: | ||
Investments | 793 | 413 |
Marketable equity securities | Recurring | ||
Assets: | ||
Investments | 4,354 | 2,718 |
Marketable equity securities | Recurring | Level 1 | ||
Assets: | ||
Investments | 4,354 | 2,718 |
Warrants | Recurring | ||
Assets: | ||
Investments | 793 | 413 |
Warrants | Recurring | Level 2 | ||
Assets: | ||
Investments | $ 793 | $ 413 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Surety, Reclamation Bonds and Flow-Through Common Shares (Details) $ in Thousands, $ in Millions | Mar. 29, 2019USD ($) | Dec. 20, 2018CAD ($) | Dec. 20, 2018USD ($) | Dec. 19, 2017CAD ($) | Dec. 19, 2017USD ($) | Jun. 30, 2019CAD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2018USD ($) |
Reclamation Bonds | ||||||||
Other assets | $ 2,564 | $ 5,872 | ||||||
Amount raised or spent in connection with the equity issuance | $ 20,300 | 22,900 | ||||||
Timmins | ||||||||
Reclamation Bonds | ||||||||
Restrictive time deposits for reclamation bonding | $ 100 | |||||||
Surety Bonds | ||||||||
Reclamation Bonds | ||||||||
Percentage of annual fees on surety bonds | 2.00% | 2.00% | ||||||
Surety bonds upfront deposit amount | $ 0 | |||||||
Surety bonding obligation | 20,000 | |||||||
Surety Bonds | Canada | ||||||||
Reclamation Bonds | ||||||||
Surety bonding obligation | $ 20.6 | 15,700 | ||||||
Reclamation Bonds | Tonkin and Gold Bar Properties | ||||||||
Reclamation Bonds | ||||||||
Reclamation bonding obligation | 20,000 | |||||||
Black Fox | Reclamation Bonds | ||||||||
Reclamation Bonds | ||||||||
Reclamation bonding obligation | $ 20.6 | $ 15,700 | ||||||
Flow Through Common Shares | ||||||||
Reclamation Bonds | ||||||||
Amount raised or spent in connection with the equity issuance | $ 20 | $ 14,900 | $ 12.9 | $ 10,000 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Streaming Agreement (Details) - USD ($) | Aug. 25, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Black Fox | |||||
Other commitments | |||||
Obligation to sell (as a percent) | 8.00% | ||||
Long term gold price (in dollars per ounce) | $ 550 | ||||
Revenue of acquiree since acquisition date and implementation of streaming agreement | $ 500,000 | $ 600,000 | $ 900,000 | $ 1,300,000 | |
Black Fox | Maximum | |||||
Other commitments | |||||
Inflation adjustment (as a percent) | 2.00% | ||||
Pike River property | |||||
Other commitments | |||||
Obligation to sell (as a percent) | 6.30% |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Short-term Bank Indebtedness (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Short-term Bank Indebtedness | ||
Long-term debt | $ 24,678 | $ 24,603 |
CASH AND CASH EQUIVALENTS AND_3
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (Details) $ in Thousands, $ in Millions | Mar. 29, 2019USD ($) | Dec. 20, 2018CAD ($) | Dec. 20, 2018USD ($) | Dec. 19, 2017CAD ($) | Dec. 19, 2017USD ($) | Jun. 30, 2019USD ($) | Dec. 31, 2018USD ($) | Jun. 30, 2018USD ($) | Dec. 31, 2017USD ($) |
Cash and cash equivalents | $ 9,325 | $ 15,756 | |||||||
Restricted cash | 13,112 | 14,685 | |||||||
Restricted cash included in other long-term assets | 48 | 48 | |||||||
Total cash, cash equivalents, and restricted cash | 22,485 | $ 30,489 | $ 19,697 | $ 37,153 | |||||
Net proceeds | $ 20,300 | 22,900 | |||||||
Common Stock | |||||||||
Net proceeds | 20,300 | ||||||||
Warrants | |||||||||
Net proceeds | $ 2,600 | ||||||||
Flow Through Common Shares | |||||||||
Net proceeds | $ 20 | $ 14,900 | $ 12.9 | $ 10,000 |