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Coeur Mining, Inc. — Capital/Financing Update 2006
Jun 7, 2006
30519_rns_2006-06-07_9f0799b7-471e-4e05-95fc-158de5de82a9.zip
Capital/Financing Update
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8-K 1 dbk176.htm CURRENT REPORT MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Project"
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
MARKER FORMAT-SHEET="Head Major Center Bold-TNR" FSL="Project"
FORM 8-K
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CURRENT REPORT
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Pursuant to Section 13 or 15 (d) of the Securities and Exchange Act of 1934
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Date of Report (Date of earliest event reported): June 1, 2006
| COEUR DALENE MINES CORPORATION |
|---|
| (Exact name of Registrant as specified in its charter) |
| Idaho | 1-8641 | 84-0109423 |
|---|---|---|
| (State or Other Jurisdiction of | (Commission File Number) | (I.R.S. Employer |
| Incorporation) | Identification No.) |
| 400 Coeur dAlene Mines Bldg., 505 Front Avenue, | 83814 |
|---|---|
| Coeur dAlene, Idaho | (Zip Code) |
| (Address of Principal Executive Office) |
MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Project"
Registrants telephone number, including area code: (208) 667-3511
| Not Applicable |
|---|
| (Former name or former address, if changed since last report) |
MARKER FORMAT-SHEET="Page Rule Single" FSL="Default" MARKER FORMAT-SHEET="Para Flush Lv 0-TNR" FSL="Project"
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Project"
[_] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Project"
[_] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Project"
[_] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Project"
[_] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
MARKER PAGE="sheet: 1; page: 1" MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Project"
Item 2.01. Completion of Acquisition or Disposition of Assets.
MARKER FORMAT-SHEET="Para Large Indent" FSL="Default"
On June 1, 2006, Coeur dAlene Mines Corporation (the Company) completed the sale of 100% of the shares of its wholly-owned subsidiary, Coeur Silvery Valley (CSV), to U.S. Silver Corporation for a total of $15 million in cash. The Stock Purchase Agreement provides for a post-closing working capital adjustment that is expected to be finalized in July 2006. The Company expects that any resulting adjustment to the purchase price will not be material in amount. The Company anticipates that the transaction will result in a one-time pre-tax gain of approximately $12 million in the quarter ended June 30, 2006.
MARKER FORMAT-SHEET="Para Large Indent" FSL="Default"
CSV owned and operated the Galena underground silver mine and owned the adjacent Coeur underground silver mine. In addition, CSV owned the Caladay Property that adjoins the Galena Mine and had operating control of several contiguous exploration properties in the Coeur dAlene Silver Mining District of Idaho. CSVs property consisted of 6,131 acres of Company-owned fee land, patented mining claims and unpatented claims in addition to 4,800 acres of leased claims.
MARKER FORMAT-SHEET="Para Large Indent" FSL="Default"
There is no material relationship, other than with respect to the transaction, between U.S. Silver Corporation and the Company or any of its affiliates, or any director or officer of the Company or any associate of any such director or officer.
MARKER FORMAT-SHEET="Para Large Indent" FSL="Default"
Reference is made to Item 9.01(b) below for the pro forma financial information required pursuant to Article 11 of Regulation S-X.
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Item 9.01. Financial Statements and Exhibits.
MARKER FORMAT-SHEET="Para (List) Flush" FSL="Default"
(b) Pro Forma Financial Information:
MARKER FORMAT-SHEET="Para Large Indent" FSL="Default"
The following unaudited financial information reflects the pro forma consolidated statements of operations for the three months ended March 31, 2006 and the year ended December 31, 2005 and the related pro forma consolidated balance sheet as of March 31, 2006 giving effect to the sale of Coeur Silver Valley, Inc. (CSV). The unaudited pro forma consolidated statement of operations for the three months ended March 31, 2006 and the year ended December 31, 2005 gives effect to the sale. The unaudited pro forma consolidated balance sheet as of March 31, 2006 assumes the sale occurred on March 31, 2006. The pro forma information is based on the historical financial statements of the Company after giving effect to the sale and are not necessarily indicative of the financial position or results of operations of the Company that would have actually occurred had the transaction been completed as of the date of, or as of the beginning of the periods presented. The pro forma consolidated financial statements have been prepared based on preliminary estimates. The pro forma financial information should be read in conjunction with the Companys historical financial statements included in its Form 10-K for the year ended December 31, 2005.
MARKER PAGE="sheet: 2; page: 2" MARKER FORMAT-SHEET="Head Minor Center" FSL="Default"
COEUR DALENE MINES CORPORATION AND SUBSIDIARIES PRO FORMA CONSOLIDATED BALANCE SHEET AS OF MARCH 31, 2006 (Unaudited)
| As Reported | Silver Valley (A) | Pro Forma | ||||
|---|---|---|---|---|---|---|
| ASSETS | (In Thousands) | |||||
| CURRENT ASSETS | ||||||
| Cash and cash equivalents | $ 347,651 | $ | 15,000 | $ 362,651 | ||
| Short-term investments | 26,690 | -- | 26,690 | |||
| Receivables | 23,038 | -- | 23,038 | |||
| Ore on leach pad | 27,743 | -- | 27,743 | |||
| Metal and other inventories | 12,986 | -- | 12,986 | |||
| Deferred tax assets | 2,678 | -- | 2,678 | |||
| Prepaid expenses and other | 6,388 | -- | 6,388 | |||
| Assets of operations held for sale (Note D) | 15,877 | (15,877 | ) | -- | ||
| 463,051 | (877 | ) | 462,174 | |||
| PROPERTY, PLANT AND EQUIPMENT | ||||||
| Property, plant and equipment | 109,049 | -- | 109,049 | |||
| Less accumulated depreciation | (59,852 | ) | -- | (59,852 | ) | |
| 49,197 | -- | 49,197 | ||||
| MINING PROPERTIES | ||||||
| Operational mining properties | 122,650 | -- | 122,650 | |||
| Less accumulated depletion | (107,794 | ) | -- | (107,794 | ) | |
| 14,856 | -- | 14,856 | ||||
| Mineral interests | 72,201 | -- | 72,201 | |||
| Less accumulated depletion | (3,860 | ) | -- | (3,860 | ) | |
| 68,341 | -- | 68,341 | ||||
| Non-producing and development properties | 89,886 | -- | 89,886 | |||
| 173,083 | -- | 173,083 | ||||
| OTHER ASSETS | ||||||
| Ore on leach pad, non-current portion | 31,316 | -- | 31,316 | |||
| Restricted cash and cash equivalents | 17,041 | -- | 17,041 | |||
| Debt issuance costs, net | 5,378 | -- | 5,378 | |||
| Deferred tax assets | 2,837 | -- | 2,837 | |||
| Other | 7,666 | -- | 7,666 | |||
| 64,238 | -- | 64,238 | ||||
| TOTAL ASSETS | $ 749,569 | $ | (877 | ) | $ 748,692 |
MARKER FORMAT-SHEET="Para Large Indent" FSL="Default"
The accompanying notes are an integral part of these consolidated financial statements.
MARKER PAGE="sheet: 3; page: 3" MARKER FORMAT-SHEET="Head Minor Center" FSL="Default"
COEUR DALENE MINES CORPORATION AND SUBSIDIARIES PRO FORMA CONSOLIDATED BALANCE SHEET AS OF MARCH 31, 2006 (Unaudited)
| As Reported | Silver Valley (A) | Pro Forma | ||||
|---|---|---|---|---|---|---|
| (In thousands except per share data) | ||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||
| CURRENT LIABILITIES | ||||||
| Accounts payable | $ 12,426 | $ | -- | $ 12,426 | ||
| Other current liabilities | 6,604 | -- | 6,604 | |||
| Accrued interest payable | 469 | -- | 469 | |||
| Accrued salaries and wages | 4,864 | -- | 4,864 | |||
| Current taxes payable | 1,716 | -- | 1,716 | |||
| Liabilities of operations held for sale | 12,816 | (12,816 | ) | -- | ||
| 38,895 | (12,816 | ) | 26,079 | |||
| LONG-TERM LIABILITIES | ||||||
| 11/4% Convertible Senior Notes due January 2024 | 180,000 | -- | 180,000 | |||
| Reclamation and mine closure | 24,301 | -- | 24,301 | |||
| Other long-term liabilities | 4,286 | -- | 4,286 | |||
| 208,587 | -- | 208,587 | ||||
| COMMITMENTS AND CONTINGENCIES | ||||||
| SHAREHOLDERS' EQUITY | ||||||
| Common Stock, par value $1.00 per share; authorized 500,000,000 | ||||||
| shares, issued 278,869,045 shares in 2006 (1,059,211 shares | ||||||
| held in treasury) | 278,869 | -- | 278,869 | |||
| Additional paid-in capital | 775,611 | -- | 775,611 | |||
| Accumulated deficit | (537,369 | ) | 9,720 | (527,649 | ) | |
| Shares held in treasury | (13,190 | ) | -- | (13,190 | ) | |
| Accumulated other comprehensive loss | (1,834 | ) | 2,219 | 385 | ||
| 502,087 | 11,939 | 514,026 | ||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 749,569 | $ | (877 | ) | $ 748,692 |
MARKER FORMAT-SHEET="Para Flush" FSL="Default"
The accompanying notes are an integral part of these consolidated financial statements.
MARKER PAGE="sheet: 4; page: 4" MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Project"
COEUR D'ALENE MINES CORPORATION AND SUBSIDIARIES PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) THREE MONTHS ENDED MARCH 31, 2006 (Unaudited)
| As Reported | Pro Forma | |||||
|---|---|---|---|---|---|---|
| REVENUES | ||||||
| Sales of metal | $ 44,854 | -- | $ 44,854 | |||
| COSTS AND EXPENSES | ||||||
| Production costs applicable to sales | 20,099 | -- | 20,099 | |||
| Depreciation and depletion | 6,318 | -- | 6,318 | |||
| Administrative and general | 5,090 | -- | 5,090 | |||
| Exploration | 1,968 | -- | 1,968 | |||
| Total cost and expenses | 33,475 | -- | 33,475 | |||
| OTHER INCOME AND EXPENSE | ||||||
| Interest and other income | 2,521 | -- | 2,521 | |||
| Interest expense, net of capitalized interest | (521 | ) | -- | (521 | ) | |
| Total other income and expense | 2,000 | -- | 2,000 | |||
| Income (loss) from continuing operations before income taxes | 13,379 | -- | 13,379 | |||
| Income tax benefit (provision) | 347 | -- | 347 | |||
| INCOME (LOSS) FROM CONTINUING OPERATIONS | 13,726 | -- | 13,726 | |||
| Income (loss) from discontinued operations, net of income | ||||||
| taxes | 612 | (612 | ) | -- | ||
| NET INCOME (LOSS) | 14,338 | (612 | ) | 13,726 | ||
| Other comprehensive income (loss) | 4 | -- | 4 | |||
| COMPREHENSIVE INCOME (LOSS) | $ 14,342 | $ | (612 | ) | $ 13,730 | |
| BASIC AND DILUTED INCOME (LOSS) PER SHARE | ||||||
| Basic income (loss) per share: | ||||||
| Income (loss) from continuing operations | $ 0.06 | $ | -- | $ 0.06 | ||
| Income (loss) from discontinued operations | -- | -- | -- | |||
| Net income (loss) | $ 0.06 | $ | -- | $ 0.06 | ||
| Diluted income (loss) per share: | ||||||
| Income (loss) from continuing operations | $ 0.05 | $ | -- | $ 0.05 | ||
| Income (loss) from discontinued operations | -- | -- | -- | |||
| Net income (loss) | $ 0.05 | $ | -- | $ 0.05 | ||
| Weighted average number of shares of common stock | ||||||
| Basic | 252,485 | 252,485 | ||||
| Diluted | 277,383 | 277,383 |
MARKER FORMAT-SHEET="Para Flush" FSL="Default"
The accompanying notes are an integral part of these consolidated financial statements.
MARKER PAGE="sheet: 5; page: 5" MARKER FORMAT-SHEET="Head Minor Center-TNR" FSL="Project"
COEUR D'ALENE MINES CORPORATION AND SUBSIDIARIES PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) YEAR ENDED DECEMBER 31, 2005 (Unaudited)
| As Reported | Pro Forma | |||||
|---|---|---|---|---|---|---|
| (In Thousands, except per share data) | ||||||
| REVENUES | ||||||
| Sales of metal | $ 172,336 | $ | (16,052 | ) | $ 156,284 | |
| COSTS AND EXPENSES | ||||||
| Production costs applicable to sales | 104,930 | (16,698 | ) | 88,232 | ||
| Depreciation and depletion | 20,885 | (1,996 | ) | 18,889 | ||
| Administrative and general | 19,417 | -- | 19,417 | |||
| Exploration | 11,914 | (1,361 | ) | 10,553 | ||
| Pre-development | 6,057 | -- | 6,057 | |||
| Write-down of mining properties and other holding costs | 1,379 | (172 | ) | 1,207 | ||
| Litigation settlement | 1,600 | -- | 1,600 | |||
| Total cost and expenses | 166,182 | (20,227 | ) | 145,955 | ||
| OTHER INCOME AND EXPENSE | ||||||
| Interest and other income | 8,365 | 20 | 8,385 | |||
| Interest expense, net of capitalized interest | (2,485 | ) | -- | (2,485 | ) | |
| Total other income and expense | 5,880 | 20 | 5,900 | |||
| INCOME (LOSS) FROM CONTINUING OPERATIONS | 12,034 | 4,195 | 16,229 | |||
| Income tax (provision) benefit | (1,483 | ) | -- | (1,483 | ) | |
| NET INCOME (LOSS) | 10,551 | 4,195 | 14,746 | |||
| Other comprehensive income (loss) | 447 | 1,982 | 2,429 | |||
| COMPREHENSIVE INCOME (LOSS) | $ 10,998 | $ | 6,177 | $ 17,175 | ||
| BASIC AND DILUTED INCOME (LOSS) PER SHARE | ||||||
| Basic income (loss) per share: | ||||||
| Net income (loss) | $ 0.04 | $ | 0.02 | $ 0.06 | ||
| Diluted income (loss) per share: | ||||||
| Net income (loss) | $ 0.04 | $ | 0.02 | $ 0.06 | ||
| Weighted average number of shares of common stock | ||||||
| Basic | 242,915 | 242,915 | ||||
| Diluted | 243,683 | 243,683 |
MARKER FORMAT-SHEET="Para Flush" FSL="Default"
The accompanying notes are an integral part of these consolidated financial statements.
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NOTE TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
MARKER FORMAT-SHEET="Para Hang Lv 0-TNR" FSL="Project"
- Pro Forma Adjustments.
MARKER FORMAT-SHEET="Para Flush Level 1" FSL="Default"
The accompanying pro forma consolidated statements of operations for the year ended December 31, 2005 and for the three months ended March 31, 2006 reflect the sale of Coeur Silver Valley. The pro forma consolidated balance sheet as of March 31, 2006 gives pro forma effect of the sale as if it occurred on March 31, 2006. Actual reported results may vary from those contained in the pro forma disclosure. These pro forma financial statements include the following pro forma adjustments:
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Project"
(A) Reduction of assets and liabilities as a result of the sale.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Project"
(B) Reduction of the revenues and expenses as a result of the sale.
MARKER FORMAT-SHEET="Para Flush Lv 1-TNR" FSL="Project"
The estimated investment income from the cash proceeds have not been included as pro forma adjustments.
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SIGNATURES
MARKER FORMAT-SHEET="Para Large Indent" FSL="Default"
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| COEUR D'ALENE MINES CORPORATION | |
|---|---|
| (Registrant) | |
| Dated: June 7, 2006 | By: /s/ James A. Sabala |
| James A. Sabala | |
| Executive Vice President and | |
| Chief Financial Officer |