Stillwater Mining Company Reports Third Quarter Earnings

Marketwired

BILLINGS, MT--(Marketwire - Oct 30, 2012) - STILLWATER MINING COMPANY (NYSE: SWC) (TSX: SWC.U)

  • Net income attributable to common stockholders of $13.0 million or $0.11 per diluted share
  • Third-quarter mine production of 127,000 ounces; 500,000 ounce guidance for full year 2012 reiterated
  • Lower metal prices reduce earnings
  • Offering of $396.75 million of 1.75% senior convertible notes completed this month
  • Montana development projects continue to advance
  • New-miner training recruitment for development efforts progressing well

Stillwater Mining Company today reported consolidated net income attributable to common stockholders for the 2012 third quarter of $13.0 million, or $0.11 per diluted share. Total revenues for the third quarter were $181.0 million. Net income attributable to common stockholders reported for the third quarter of 2011 was $40.7 million, or $0.37 per diluted share with revenues of $253.7 million. The third quarter 2012 results reflect lower PGM prices and higher consolidated total cash costs than in last year's third quarter and include a $6.6 million foreign currency transaction gain and exploration expenses of $1.7 million.

For the first nine months of 2012, Stillwater reported net income attributable to common stockholders of $33.6 million, or $0.29 per diluted share, on revenues of $596.9 million, compared to net income of $119.6 million, or $1.10 per diluted share, on revenues of $646.3 million, for the same period in 2011.

The Company's mines produced a total of 127,000 ounces of palladium and platinum during the third quarter of 2012, a 2.3% decrease from the 130,000 ounces produced in the third quarter of 2011 and a 4.8% decrease from the 133,400 ounces produced during the second quarter of 2012. Production for the first nine months of 2012 was 381,200 ounces compared to 403,800 ounces in the first nine months of 2011. Most of the variability in production is the result of normal changes in mining conditions and the array of stopes available for mining from period to period. Based on production results for the first nine months of 2012 and projections for the remainder of the year, the Company is reiterating its full year 2012 guidance for mine production of 500,000 ounces. 

Third quarter 2012 revenues from sales of mined production (including by-products) totaled $107.1 million, down from $145.0 million in the same period last year as a result of lower PGM prices and volumes. Combined sales realizations decreased during the third quarter of 2012 for mined palladium and platinum ounces, averaging $803 per ounce, an 18.7% decrease from the $988 per ounce realized in the third quarter of 2011. The total quantity of mined palladium and platinum sold declined to 124,300 ounces in the third quarter of 2012, a 9.8% decrease compared to the 137,800 ounces sold during the same period in 2011. Income in the third quarter of 2012 included $23.3 million from mining operations and $1.9 million from recycling activities. For the third quarter of 2011, income from mining operations and recycling activities were $58.6 million and $4.4 million, respectively.

Total cash costs per mined ounce (a non-GAAP measure defined below) averaged $496 in the third quarter of 2012, compared to total cash costs of $439 per ounce for the third quarter of 2011. This expected increase in cash costs is primarily a result of lower mine production and higher labor costs, reflecting an increase in contractual wage and benefit rates and hiring for the Company's new miner training program that was implemented earlier this year. The total number of Montana employees has increased to 1,629 at the end of the third quarter of 2012 from 1,493 at the end of the third quarter of 2011. Based on current projections, the Company is maintaining its total cash costs guidance of $500 per mined ounce for the full year 2012.

The Company processed recycling material containing 96,200 ounces of palladium, platinum and rhodium through its smelter and refinery during the third quarter of 2012, down from the 133,500 ounces recycled during the third quarter of 2011. Recycling sales volumes decreased to 74,600 ounces in the third quarter of 2012, from 86,700 ounces in the third quarter of 2011. Revenues from sales of purchased recycling materials totaled $73.5 million in the 2012 third quarter, down from $106.6 million in the same period last year. Tolling revenues declined to $0.5 million in this year's third quarter, compared to $0.8 million in the comparable quarter of 2011. The Company's recycling segment had income for the 2012 third quarter of $1.9 million (including financing income), compared to income of $4.4 million reported for the third quarter of 2011. The Company's combined average realized price for sales of recycled palladium, platinum and rhodium declined to $985 per ounce in the third quarter of 2012 from $1,230 per ounce in the third quarter of 2011.

Commenting on the Company's third quarter results, Frank McAllister, the Company's Chairman and Chief Executive Officer, observed, "Overall, we are pleased with the Company's third quarter performance, especially when considering the rather volatile metal markets during the quarter. While palladium and platinum prices were substantially lower than in the same period last year, our operating mines performed well and our development projects have continued to advance. Both mine production and cash costs remain on target, and we have reaffirmed our guidance for the year 2012 of 500,000 total mined ounces of palladium and platinum at a total cash cost of $500 per ounce. At the same time, we have reduced our guidance for 2012 capital and exploration expenditures. We now estimate 2012 capital spending at about $127 million from $135 million and exploration spending at about $17 million from $27 million.

"As we reported previously, the new tunnel boring machine, or TBM, has just now been put into operation at the Blitz project. Utilization of the TBM expands the scope of our drilling and accelerates the time frame. This underground machine is an impressive 450 feet long when fully assembled and cuts a tunnel 18 feet in diameter. The new TBM has been installed inside the east portal at the Stillwater Mine and ultimately will drive a 23,000-foot access drift to the east along the J-M Reef. Simultaneously, a mining team will drive a parallel tunnel about 600 feet above the TBM, using conventional drill and blast methods. Both tunnels eventually will be intersected by a new surface portal and decline situated at their far end that will provide ventilation and emergency egress for the Blitz area. The Blitz project, which provides a backbone for potential future operations to the east of the Stillwater Mine, is targeted for completion in late 2016 or 2017. We have recently updated our assessment of total cost to complete the project, which currently is estimated at about $197 million.

"We also have continued to make progress on our Graham Creek project, expanding to the west of our existing operations at the East Boulder Mine. The TBM there, which was already in place as a holdover from the original East Boulder project, has now progressed about 5,700 feet to the west, out of its total targeted footage of about 8,200 feet. The TBM drive at Graham Creek should be finished sometime in the first half of 2013, after which we will begin developing two new ventilation shafts to the surface to provide support for future operations in that area. The Graham Creek project should wrap up in early 2015, at a total cost that we now estimate will be about $13 million."

Referencing the Company's Marathon PGM-copper project near the north shore of Lake Superior in Canada, Mr. McAllister noted, "Our efforts at Marathon continue to progress primarily on two fronts right now -- the joint federal/provincial environmental review is advancing, and definitive engineering design work is underway. A few weeks ago we announced preliminary engineering findings that indicate the palladium metal content was overestimated in a portion of the original resource and reserve modeling work provided to us at the time of the acquisition. We still don't know the overall effect or materiality of these findings on Marathon's infrastructure, on its economics, or on its permitting timeline, but as we cautioned earlier, the effect is likely to be some deterioration in both project economics and ore reserves. At the same time, we also are seeing some potential increase in the overall resource tonnage as a result of higher metals prices, better-than-estimated metal recoveries and new drilling information, which might partially offset the effect of lower ore reserve grades. We expect the final engineering study to be completed during the first half of 2013. "

Turning to the Company's Altar copper-gold exploration project, located in the high Andes of the San Juan province in northwestern Argentina, Mr. McAllister continued, "Other than finishing up some metallurgical studies on the drill results from this past year's drilling season, activity on the Altar project was fairly limited during the third quarter. We were able to publish our drill results for the drill season that ended this past April, which are available on the Company's website. The results were generally encouraging. This drilling extended the known mineralization to greater depth in the original Altar discovery area, confirmed the presence and significance of a second distinct mineralizing center with somewhat higher gold grades in the eastern portion of the Altar resource area, and reconnaissance drilling penetrated a potential third distinct mineralizing center indicating additional mineral potential to the north of the current Altar resource. Drilling still has not defined the perimeter of the Altar mineralizing area. Added drilling at Quebrada de la Mina, a promising gold target to the northwest of the principal Altar mineral resource, indicated attractive gold grades but insufficient volumes to sustain a stand-alone gold operation there. 

"While Altar exploration and related support expenditures were budgeted at about $25 million for 2012, only about $15.9 million in total (including administrative expenses) has been spent through September, suggesting that even with some added fourth quarter costs to mobilize next year's drilling program, total spending at Altar will probably not exceed $20 million this year. Drilling in the 2012-2013 season will focus on extending our understanding of the Altar resource at depth, as well as trying to determine the eastern boundary of the mineralization."

Concluding his review of the Company's projects, Mr. McAllister added, "After we commissioned our new smelting furnace in May of 2009, we stripped the brick out of the prior furnace in anticipation of refurbishing it to become a slag cleaning circuit. During 2011, we rebricked the old furnace and completed the necessary engineering of the operating systems in order to connect the modified furnace with the Company's primary smelting furnace. Most of the slag handling changes have now been completed or are currently in progress. The electric arc in the reconfigured furnace has now been struck and conditioning of the furnace is currently underway. Once operational, the slag cleaning furnace will be temporarily used for smelting so that final modifications can be installed on the primary furnace. Construction is scheduled to be complete and the slag cleaning circuit fully operational at the beginning of December 2012. Our engineers have estimated that the slag cleaning operation will recover approximately 4,000 ounces of PGMs annually from both mined and recycled materials that would otherwise remain bound up in the smelter slags.

"Separately, work on our new precious metal refining technology continues with further process test work scheduled during the fourth quarter of 2012."

Commenting on the Company's recent convertible debenture offering, which closed earlier this month, Mr. McAllister observed, "The Company's successful $396.75 million convertible debt offering positions us to pay off the $166.5 million of existing convertible notes that are due to be redeemed early next year. It also provides assurance that adequate working capital should be available to sustain our operations and to progress with the Marathon project, once the necessary approvals are in hand and the engineering design work is completed. At the appropriate time, we expect to seek additional financing for the Marathon project. These notes bear interest at a rate of 1.75% per annum, do not provide for redemption until 2019, and they allow the Company to settle them in any combination of shares and cash, at our election. We are very pleased with the terms we achieved in this financing.

"Finally, on a personal note, I would like to welcome Mr. Gary Sugar as a new director recently appointed to our Company's board. Gary is a geologist by training and an investment banker by profession, having recently retired after more than 30 years with RBC Capital Markets in Canada. We are delighted to have him join us, and we look forward to benefiting from his experience and insight."

Cash Flow and Liquidity

At September 30, 2012, the Company's available cash was $198.5 million, compared to $109.1 million at December 31, 2011. If highly liquid short-term investments are included with available cash, the Company's balance sheet liquidity totaled $274.7 million at September 30, 2012, an increase from $158.6 million at December 31, 2011. Of the Company's current cash balance, $45.9 million is dedicated to the Marathon project (and other related properties) and is unavailable for other corporate purposes. Net working capital -- comprised of total current assets (including available cash and short-term investments), less current liabilities -- decreased to $199.7 million at September 30, 2012, from $251.6 million at year end 2011. The September 30, 2012 amount includes $166.5 million reclassified as the current portion of long-term debt, reflecting convertible debentures that may be redeemed by their holders on March 15, 2013.

Net cash provided by operating activities (which includes changes in working capital) totaled $45.1 million in the third quarter of 2012, compared to $35.2 million of cash provided in the third quarter of 2011. Capital expenditures were $25.4 million in the third quarter of 2012, down from $27.9 million in the third quarter of 2011. 

Outstanding debt at September 30, 2012, was $203.3 million, up from $196.0 million at December 31, 2011. The Company's total debt includes the $166.5 million outstanding in the form of convertible debentures, $29.6 million of Exempt Facility Revenue Bonds due in 2020, a capital lease of $6.9 million and $0.3 million for a small installment land purchase. Subsequent to the end of the 2012 third quarter, on October 17, 2012, the Company completed the issuance and sale of $396.75 million of 1.75% convertible senior unsecured notes due in 2032. The Company intends to use the net proceeds from the offering to repay amounts that may come due under the Company's outstanding 1.875% convertible debentures in March 2013, and for general corporate purposes.

Third Quarter Results - Details

For the third quarter of 2012, the Company's mine production was 127,000 PGM ounces. The Company's Stillwater Mine produced 94,100 ounces, a decrease of 2.8% from the 96,800 ounces produced in the third quarter of 2011 and a decrease of 4.1% from the 98,100 ounces produced in the second quarter of 2012. The production decrease from last year's third quarter at the Stillwater Mine was primarily attributable to lower tons mined as a result of the fluctuations in overall mining conditions, the mix of mining stopes, emphasis on mine development and the availability of miners. Production at the Company's East Boulder Mine of 32,900 ounces in the third quarter of 2012 reflected a decrease from the 33,200 ounces produced in the same quarter of 2011 and from the 35,300 ounces produced in the second quarter of 2012.

Revenues for the third quarter of 2012 were $181.0 million, a decline of 28.6% from the $253.7 million recorded in the third quarter of 2011. Proceeds from sales of mined PGMs and by-products totaled $107.1 million in the third quarter of 2012, down 26.1% from the $145.0 million in the same quarter of 2011, reflecting both lower ounces sold and reduced PGM prices during the quarter. Recycling revenues fell by 31.2% to $74.0 million from $107.5 million in the third quarter of 2011 primarily as a result of lower PGM prices. Sales from mine production totaled 124,300 ounces in the third quarter of 2012 at an overall average realization of $803 per ounce, as compared to 137,800 ounces at $988 per ounce in the third quarter of 2011. Sales ounces were less than production in the third quarter of 2012 due to normal timing differences in inventory flows. The Company's average net realization on palladium sales from mine production was $605 per ounce in the third quarter of 2012, compared to $772 per ounce for the same period in 2011. The Company's average net realization on mined platinum was $1,513 per ounce in the third quarter of 2012 and $1,784 per ounce in the third quarter of 2011. London Bullion Market Association afternoon posted prices per ounce for palladium and platinum were $642 and $1,668, respectively, on September 28, 2012, and were $614 and $1,511, respectively, on September 30, 2011.

Consolidated cash costs per mined ounce (a non-GAAP measure defined below) averaged $496 in the third quarter of 2012, up from $439 per ounce for the third quarter of 2011 and $454 per ounce reported for the second quarter of 2012. The Stillwater Mine's total cash costs averaged $469 per ounce in the third quarter of 2012, compared to the $411 per ounce reported in the third quarter of 2011. The East Boulder Mine's total cash costs averaged $574 per ounce during the third quarter of 2012, compared to $520 per ounce during third quarter of 2011. The most significant driver of cash cost per mined ounce growth since the third quarter of last year at both mines was an increase in staffing levels, along with higher wage and benefit rates and lower mine production. The increase in staffing levels was primarily attributable to hiring for the new-miner training program in support of new projects and to accommodate increasing underground travel distances and operations support requirements as the mines expand.

Costs of metals sold (before depletion, depreciation and amortization expense) decreased to $142.0 million in the third quarter of 2012 from $175.5 million in the third quarter of 2011. Mining costs included in costs of metals sold declined slightly to $69.9 million in the 2012 third quarter from $71.0 million in the 2011 third quarter, the result of lower royalties and taxes at lower metals prices. Recycling costs, which primarily reflect the cost of acquiring spent catalytic materials for processing, totaled $72.1 million in the third quarter of 2012, lower than the $103.3 million reported in the third quarter of 2011. The decrease was due to lower volumes sold and the related lower market value of the materials acquired for processing. 

Depletion, depreciation and amortization expense decreased to $14.1 million in the third quarter of 2012 from $15.6 million in the same period of 2011. The decrease is attributable to a lower depreciable base in our fixed asset accounts in 2012, as many assets were fully depreciated during 2010 and 2011. Lower production rates also tend to drive depletion expense lower.

General and administrative ("G&A") costs were $9.9 million in the third quarter of 2012, down from the $13.1 million incurred during the same period of 2011. The third quarter of 2011 included $4.7 million in expenses associated with financing activities and $1.3 million of acquisition costs related to Peregrine Metals Ltd. Exploration expenses totaled $1.7 million for the third quarter of 2012, of which almost all was attributable to the Altar copper-gold project. Exploration expenses incurred during the third quarter of 2011 were $0.3 million. Marketing expenses decreased to $1.9 million in the 2012 third quarter compared to $4.3 million in the same quarter of 2011. Research and development costs decreased to less than $0.1 million in the third quarter of 2012 from $0.5 million in the same quarter of 2011.

Reported net income attributable to common stockholders for the third quarter of 2012 of $13.0 million included, by business segment, income of $23.3 million from mining operations, income of $1.9 million from recycling activities (including financing income), income of $5.0 million related to the Altar copper-gold project (including a foreign currency transaction gain of $6.5 million less exploration costs and G&A costs of $1.5 million), $1.3 million of costs associated with the Marathon properties, and corporate costs of $13.8 million, which included a loss on long-term investments in certain Canadian exploration companies of $1.7 million and marketing expense of $1.9 million.

The Company reported a $2.4 million income tax provision and a $0.3 million cost allocation attributable to noncontrolling interest in the third quarter of 2012. For the third quarter of 2011, the net income attributable to common stockholders of $40.7 million included, by business segment, $58.6 million of income from mining operations and $4.4 million income from recycling activities (including financing income), $0.9 million of costs associated with the Marathon properties and corporate costs of $18.6 million. For the third quarter of 2011, the Company reported a $2.8 million income tax provision.

First Nine Months' Results - Details

During the first nine months of 2012, the Company's mining operations produced 381,200 ounces of palladium and platinum, including 279,900 ounces from the Stillwater Mine and 101,300 ounces from the East Boulder Mine. For the comparable period in 2011, total mine production of 403,800 ounces included Stillwater Mine production of 304,200 ounces and East Boulder production of 99,600 ounces. The decline in ounces produced at the Stillwater Mine for the first nine months of 2012 was primarily the result of normal variation among the stopes available for mining.

Sales of palladium and platinum from mine production totaled 375,400 ounces in the first nine months of 2012 at an overall average realization of $843 per ounce. The first nine months of 2011 saw sales of mine production totaling 389,500 ounces at $981 per ounce. The Company's average realization to date in 2012 on palladium sales from mine production was $640 per ounce, compared to $769 per ounce in the first nine months of 2011. The comparable average realization on platinum from mine production was $1,536 per ounce for the first nine months of 2012 and $1,778 per ounce in the first nine months of 2011.

During the first nine months of 2012, the Company processed about 326,600 ounces of PGMs from recycled catalytic materials, including both purchased catalysts and toll materials processed on behalf of others for a fee. By comparison, in the first nine months of 2011, the Company processed about 374,300 ounces of recycled material. Of the purchased catalysts processed, the Company sold a total of 249,900 ounces of palladium, platinum and rhodium during the first nine months of 2012 at an overall average price of about $1,020 per ounce; for the first nine months of 2011, the Company sold about 190,700 recycled ounces at an average realization of $1,232 per ounce.

Revenues for the first nine months of 2012 totaled $596.9 million, a decrease of 7.6% from the $646.3 million in the first nine months of 2011. Recycling revenues increased to $256.9 million in the first nine months of 2012 from $238.4 million in last year's first nine months, as higher recycling volumes more than offset the lower 2012 PGM prices. Proceeds from sales of mined PGMs totaled $340.0 million in the 2012 first nine months, down from $406.7 million in the same period of 2011.

Costs of metals sold (before depletion, depreciation and amortization expense) increased to $468.3 million in the first nine months of 2012 from $425.5 million in the first nine months of 2011. Mining costs included in total costs of metals sold increased to $218.9 million in the first nine months of 2012 from $196.4 million in the 2011 period. Recycling costs, largely comprised of the cost to purchase spent catalytic materials for processing, totaled $249.4 million in the first nine months of 2012, up from $228.0 million in the first nine months of 2011.

Depletion, depreciation and amortization expense decreased to $43.6 million in the first nine months of 2012 compared to $47.4 million in the same period of 2011.

General and administrative ("G&A") costs increased to $32.5 million in the first nine months of 2012 from the $29.4 million for the same period of 2011. This increase in costs for the first nine months of 2012 was primarily attributable to one-time software licensing fees, higher legal and advisory services and growth in project administrative costs. The comparable period in 2011 included $4.7 million in expenses associated with financing activities and $1.3 million of acquisition costs related to Peregrine Metals Ltd. Exploration and related support expenses totaled $13.8 million for the nine months ending September 30, 2012, of which almost all was attributable to the Altar copper-gold project. Marketing expenses remained consistent during the first nine months of 2012 at $7.9 million as compared to $8.0 million in the same time period of 2011. Research and development costs decreased to $0.9 million for the first nine months of 2012 from $1.6 million for the same period in 2011.

The Company's reported net income attributable to common stockholders of $33.6 million for the first nine months of 2012 included, by business segment, $77.9 million of income from mining operations, income of $7.9 million from recycling activities (including financing income), costs of $6.2 million associated with the Marathon properties, costs of $2.5 million related to the Altar copper-gold project (net of a foreign currency transaction gain of $13.2 million), and corporate costs of $40.7 million. For the first nine months of 2012, the Company reported a $3.4 million income tax provision and $0.7 million of costs attributable to noncontrolling interest. The net income attributable to common stockholders of $119.6 million recorded for the first nine months of 2011 included, by business segment, $164.0 million of income from mining operations and $10.7 million of income from recycling activities (including financing income), $1.9 million of costs associated with the Marathon properties and corporate costs of a $40.6 million. The Company reported a $12.6 million income tax provision for the first nine months of 2011.

Third Quarter Results Webcast and Conference Call

Stillwater Mining Company will conduct a conference call to discuss third quarter results at approximately 12:00 p.m. Eastern Daylight Time on Tuesday, October 30, 2012. 

Dial-In Numbers:
United States: (800) 230-1059
International: (612) 288-0329

The conference call will be simultaneously webcast through the Company's website at www.stillwatermining.com in the Investor Relations section. 

A telephone replay of the call will be available for one week following the event. The replay dial-in numbers are (800) 475-6701 (U.S.) and (320) 365-3844 (International), access code 267982. In addition, the call transcript will be archived in the Investor Relations section of the Company's website.

About Stillwater Mining Company

Stillwater Mining Company is the only U.S. producer of palladium and platinum and is the largest primary producer of platinum group metals outside of South Africa and the Russian Federation. The Company's shares are traded on the New York Stock Exchange under the symbol SWC and on the Toronto Stock Exchange under the symbol SWC.U. Information on Stillwater Mining can be found at its website: www.stillwatermining.com.

Some statements contained in this news release are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and, therefore, involve uncertainties or risks that could cause actual results to differ materially. These statements may contain words such as "desires," "believes," "anticipates," "plans," "expects," "intends," "estimates" or similar expressions. These statements are not guarantees of the Company's future performance and are subject to risks, uncertainties and other important factors that could cause its actual performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Additional information regarding factors that could cause results to differ materially from management's expectations is found in the section entitled "Risk Factors" in the Company's 2011 Annual Report on Form 10-K, in its quarterly Form 10-Q filings, and in corresponding filings with Canadian securities regulatory authorities. The Company intends that the forward-looking statements contained herein be subject to the above-mentioned statutory safe harbors. Investors are cautioned not to rely on forward-looking statements. The Company disclaims any obligation to update forward-looking statements.

   
   
Stillwater Mining Company  
Consolidated Statements of Operations and Comprehensive Income  
(Unaudited)  
(in thousands, except per share data)  
   
    Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
    2012     2011     2012     2011  
Revenues                                
  Mine production   $ 107,057     $ 145,033     $ 339,951     $ 406,746  
  PGM recycling     73,987       107,477       256,919       238,430  
  Other     -       1,142       -       1,142  
      Total revenues     181,044       253,652       596,870       646,318  
Costs and expenses                                
  Costs of metals sold                                
    Mine production     69,910       71,006       218,935       196,350  
    PGM recycling     72,096       103,336       249,360       228,042  
    Other     -       1,141       -       1,141  
      Total costs of metals sold     142,006       175,483       468,295       425,533  
  Depletion, depreciation and amortization                                
    Mine production     13,843       15,359       42,848       46,555  
    PGM recycling     264       269       793       796  
      Total depletion, depreciation and amortization     14,107       15,628       43,641       47,351  
        Total costs of revenues     156,113       191,111       511,936       472,884  
  Exploration     1,668       290       13,785       365  
  Marketing     1,886       4,337       7,874       7,990  
  Research and development     82       525       864       1,605  
  General and administrative     9,882       13,149       32,477       29,404  
  Abandonment of non-producing property     -       -       2,835       -  
  Loss on long-term investments     1,697       -       1,697       -  
  (Gain)/Loss on disposal of property, plant and equipment     71       84       363       (142 )
        Total costs and expenses     171,399       209,496       571,831       512,106  
Operating income     9,645       44,156       25,039       134,212  
Other income/(expense)                                
  Other     82       14       667       26  
  Interest income     271       1,106       1,706       2,839  
  Interest expense     (1,493 )     (1,635 )     (4,361 )     (4,907 )
  Foreign currency transaction gain/(loss)     6,605       (142 )     13,314       40  
Income before income tax provision     15,110       43,499       36,365       132,210  
Income tax provision     (2,418 )     (2,758 )     (3,405 )     (12,579 )
Net income   $ 12,692     $ 40,741     $ 32,960     $ 119,631  
Net loss attributable to noncontrolling interest     (304 )     -       (675 )     -  
Net income attributable to common stockholders   $ 12,996     $ 40,741     $ 33,635     $ 119,631  
Other comprehensive income/(loss), net of tax                                
  Net unrealized gains/(losses) on securities available for sale     421       (235 )     620       (339 )
Comprehensive income attributable to common stockholders   $ 13,417     $ 40,506     $ 34,255     $ 119,292  
Weighted average common shares outstanding                                
  Basic     116,377       103,114       115,918       102,831  
  Diluted     117,145       111,118       116,847       110,967  
Basic earnings per share attributable to common stockholders   $ 0.11     $ 0.40     $ 0.29     $ 1.16  
                                 
Diluted earnings per share attributable to common stockholders   $ 0.11     $ 0.37     $ 0.29     $ 1.10  
                                 
   
Stillwater Mining Company  
Consolidated Balance Sheets  
(Unaudited)  
(in thousands, except share and per share data)  
   
    September 30,
2012
    December 31,
2011
 
ASSETS                
Cash and cash equivalents   $ 198,475     $ 109,097  
Investments, at fair market value     76,252       49,533  
Inventories     125,495       131,856  
Trade receivables     9,915       6,188  
Deferred income taxes     20,154       19,819  
Other current assets     11,013       9,433  
  Total current assets     441,304       325,926  
Mineral properties     600,751       596,686  
Property, plant and equipment, net of $480,083 and $436,612 of accumulated depletion, depreciation and amortization     403,354       367,727  
Restricted cash     9,245       25,070  
Other noncurrent assets     9,843       11,915  
  Total assets   $ 1,464,497     $ 1,327,324  
LIABILITIES AND STOCKHOLDERS' EQUITY                
Accounts payable   $ 25,894     $ 26,880  
Accrued compensation and benefits     30,028       27,573  
Property, production and franchise taxes payable     12,973       14,071  
Current portion of long-term debt and capital lease obligations     168,407       -  
Income taxes payable     -       1,235  
Other current liabilities     4,344       4,576  
  Total current liabilities     241,646       74,335  
Long-term debt and capital lease obligations     34,907       196,046  
Deferred income taxes     181,516       193,884  
Accrued workers compensation     6,546       6,056  
Asset retirement obligation     7,801       7,331  
Other noncurrent liabilities     7,828       5,704  
  Total liabilities     480,244       483,356  
Equity                
Stockholders' equity                
Preferred stock, $0.01 par value, 1,000,000 shares authorized; none issued     -       -  
Common stock, $0.01 par value, 200,000,000 shares authorized; 116,756,413 and 115,375,604 shares issued and outstanding     1,168       1,154  
Paid-in capital     932,351       878,050  
Accumulated deficit     (640 )     (34,275 )
Accumulated other comprehensive loss     (341 )     (961 )
  Total stockholders' equity     932,538       843,968  
Noncontrolling interest     51,715       -  
  Total equity     984,253       843,968  
  Total liabilities and stockholders' equity   $ 1,464,497     $ 1,327,324  
                   
   
Stillwater Mining Company  
Consolidated Statements of Cash Flows  
(Unaudited)  
(in thousands)  
   
    Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
    2012     2011     2012     2011  
Cash flows from operating activities                                
Net income   $ 12,692     $ 40,741     $ 32,960     $ 119,631  
Adjustments to reconcile net income to net cash provided by operating activities:                                
  Depletion, depreciation and amortization     14,107       15,628       43,641       47,351  
  (Gain)/Loss on disposal of property, plant and equipment     71       84       363       (142 )
  Loss on long-term investments     1,697       -       1,697       -  
  Foreign currency transaction (gain)     (6,094 )     -       (12,703 )     -  
  Abandonment of non-producing property     -       -       2,835       -  
  Accretion of asset retirement obligation     160       147       470       433  
  Amortization of debt issuance costs     315       246       944       737  
  Share based compensation and other benefits     5,013       3,284       12,899       9,073  
Changes in operating assets and liabilities:                                
  Inventories     (3,700 )     (23,267 )     6,221       (78,836 )
  Trade receivables     (1,347 )     692       (3,727 )     299  
  Accrued compensation and benefits     1,162       (350 )     2,258       3,992  
  Accounts payable     1,064       3,374       (1,270 )     8,018  
  Property, production and franchise taxes payable     634       1,232       1,041       4,176  
  Income taxes payable     1,880       (7,242 )     (1,235 )     2,579  
  Workers compensation     (12 )     304       490       (250 )
  Restricted cash     15,750       -       15,825       3,000  
  Other     1,674       333       (2,275 )     7,829  
Net cash provided by operating activities     45,066       35,206       100,434       127,890  
Cash flows from investing activities                                
  Capital expenditures     (25,375 )     (27,937 )     (84,688 )     (74,232 )
  Purchase of long-term investment     -       -       -       (616 )
  Proceeds from disposal of property, plant and equipment     12       9       39       236  
  Purchases of investments     (36,399 )     (7,571 )     (68,286 )     (105,667 )
  Proceeds from maturities of investments     18,454       67,380       42,003       204,397  
Net cash (used in) provided by investing activities     (43,308 )     31,881       (110,932 )     24,118  
Cash flows from financing activities                                
  Proceeds from sale of noncontrolling interest, net of transaction costs     -       -       93,821       -  
  Issuance of long-term debt     -       -       7,176       -  
  Payments on long term debt and capital lease obligations     (451 )     -       (946 )     -  
  Payments for debt issuance costs     -       -       (219 )     -  
  Issuance of common stock     11       60       44       785  
Net cash (used in) provided by financing activities     (440 )     60       99,876       785  
Cash and cash equivalents                                
  Net increase     1,318       67,147       89,378       152,793  
  Balance at beginning of period     197,157       105,009       109,097       19,363  
Balance at end of period   $ 198,475     $ 172,156     $ 198,475     $ 172,156  
                                 
 
Stillwater Mining Company
Key Operating Factors
(Unaudited)
 
    Three Months Ended
September 30,
  Nine Months Ended
September 30,
(in thousands, except where noted)   2012   2011   2012   2011
OPERATING AND COST DATA FOR MINE PRODUCTION                        
                         
Consolidated:                        
Ounces produced                        
Palladium     98     100     294     311
Platinum     29     30     87     93
Total     127     130     381     404
Tons milled     262     283     801     873
Mill head grade (ounce per ton)     0.52     0.49     0.51     0.50
Sub-grade tons milled (1)     19     24     49     64
Sub-grade tons mill head grade (ounce per ton)     0.18     0.19     0.17     0.18
Total tons milled(1)     281     307     850     937
Combined mill head grade (ounce per ton)     0.50     0.47     0.49     0.47
Total mill recovery (%)     92     92     92     92
Total operating costs per ounce (Non-GAAP) (2)   $ 417   $ 340   $ 406   $ 324
Total cash costs per ounce (Non-GAAP) (2)   $ 496   $ 439   $ 487   $ 419
Total production costs per ounce (Non-GAAP) (2)   $ 608   $ 553   $ 600   $ 531
Total operating costs per ton milled (Non-GAAP) (2)   $ 189   $ 144   $ 182   $ 140
Total cash costs per ton milled (Non-GAAP) (2)   $ 225   $ 186   $ 219   $ 181
Total production costs per ton milled (Non-GAAP) (2)   $ 276   $ 235   $ 269   $ 229
Stillwater Mine:                        
Ounces produced                        
Palladium     72     74     215     234
Platinum     22     22     65     70
Total     94     96     280     304
Tons milled     156     184     496     573
Mill head grade (ounce per ton)     0.64     0.55     0.61     0.56
Sub-grade tons milled (1)     10     17     27     49
Sub-grade tons mill head grade (ounce per ton)     0.24     0.23     0.22     0.21
Total tons milled (1)     166     201     523     622
Combined mill head grade (ounce per ton)     0.62     0.53     0.59     0.53
Total mill recovery (%)     92     92     92     92
Total operating costs per ounce (Non-GAAP) (2)   $ 395   $ 317   $ 382   $ 312
Total cash costs per ounce (Non-GAAP) (2)   $ 469   $ 411   $ 457   $ 401
Total production costs per ounce (Non-GAAP) (2)   $ 582   $ 532   $ 574   $ 520
Total operating costs per ton milled (Non-GAAP) (2)   $ 224   $ 152   $ 204   $ 153
Total cash costs per ton milled (Non-GAAP) (2)   $ 266   $ 197   $ 244   $ 196
Total production costs per ton milled (Non-GAAP) (2)   $ 330   $ 256   $ 307   $ 254
                         
 
Stillwater Mining Company
Key Operating Factors (continued)
(Unaudited)
 
    Three Months Ended
September 30,
  Nine Months Ended
September 30,
    2012   2011   2012   2011
OPERATING AND COST DATA FOR MINE PRODUCTION                        
(Continued)                        
                         
East Boulder Mine:                        
Ounces produced                        
Palladium     26     26     79     77
Platinum     7     8     22     23
Total     33     34     101     100
Tons milled     106     99     305     300
Mill head grade (ounce per ton)     0.34     0.37     0.36     0.37
Sub-grade tons milled (1)     9     7     22     15
Sub-grade tons mill head grade (ounce per ton)     0.10     0.09     0.11     0.10
Total tons milled (1)     115     106     327     315
Combined mill head grade (ounce per ton)     0.32     0.35     0.35     0.36
Total mill recovery (%)     90     90     90     89
Total operating costs per ounce (Non-GAAP) (2)   $ 480   $ 407   $ 472   $ 362
Total cash costs per ounce (Non-GAAP) (2)   $ 574   $ 520   $ 570   $ 474
Total production costs per ounce (Non-GAAP) (2)   $ 684   $ 616   $ 674   $ 567
Total operating costs per ton milled (Non-GAAP) (2)   $ 138   $ 129   $ 147   $ 114
Total cash costs per ton milled (Non-GAAP) (2)   $ 165   $ 165   $ 177   $ 150
Total production costs per ton milled (Non-GAAP) (2)   $ 197   $ 195   $ 209   $ 179
     
(1)   Sub-grade tons milled includes reef waste material only. Total tons milled includes ore tons and sub-grade tons only. See "Proven and Probable Ore Reserves - Discussion" in the Company's 2011 Annual Report on Form 10-K for further information.
(2)   Total operating costs include costs of mining, processing and administrative expenses at the mine site (including mine site overhead and credits for metals produced other than palladium and platinum from mine production). Total cash costs include total operating costs plus royalties, insurance and taxes other than income taxes. Total production costs include total cash costs plus asset retirement costs and depreciation and amortization. Income taxes, corporate general and administrative expenses, asset impairment write-downs, gain or loss on disposal of property, plant and equipment, restructuring costs and interest income and expense are not included in total operating costs, total cash costs or total production costs. Operating costs per ton, operating costs per ounce, cash costs per ton, cash costs per ounce, production costs per ton and production costs per ounce are non-GAAP measurements that management uses to monitor and evaluate the efficiency of its mining operations. These measures of cost are not defined under U.S. Generally Accepted Accounting Principles (GAAP). Please see "Reconciliation of Non-GAAP Measures to Costs of Revenues" and the accompanying discussion for additional detail.
     
 
Stillwater Mining Company
Key Operating Factors (continued)
(Unaudited)
 
(in thousands, except for average prices)   Three Months Ended
September 30,
  Nine Months Ended
September 30,
    2012   2011   2012   2011
SALES AND PRICE DATA                        
Ounces sold                        
Mine production:                        
  Palladium (oz.)     97     109     290     308
  Platinum (oz.)     27     29     85     82
    Total     124     138     375     390
                         
PGM recycling: (1)                        
  Palladium (oz.)     42     49     145     106
  Platinum (oz.)     27     31     86     71
  Rhodium (oz.)     6     6     19     13
    Total     75     86     250     190
                         
Other: (5)                        
  Platinum (oz.)     -     1     -     1
                         
By-products from mining: (2)                        
  Rhodium (oz.)     1     2     3     2
  Gold (oz.)     2     2     7     6
  Silver (oz.)     1     1     4     4
  Copper (lb.)     219     218     568     612
  Nickel (lb.)     295     301     836     972
                         
Average realized price per ounce(3)                        
Mine production:                        
  Palladium ($/oz.)   $ 605   $ 772   $ 640   $ 769
  Platinum ($/oz.)   $ 1,513   $ 1,784   $ 1,536   $ 1,778
                         
Combined ($/oz)(4)     803   $ 988   $ 843   $ 981
PGM recycling: (1)                        
  Palladium ($/oz.)   $ 620   $ 767   $ 651   $ 744
  Platinum ($/oz.)   $ 1,491   $ 1,788   $ 1,545   $ 1,770
  Rhodium ($/oz)   $ 1,327   $ 2,192   $ 1,449   $ 2,272
Combined ($/oz)(4)   $ 985   $ 1,230   $ 1,020   $ 1,232
Other: (5)                        
  Platinum ($/oz.)   $ -   $ 1,774   $ -   $ 1,774
                         
By-products from mining: (2)                        
  Rhodium ($/oz.)   $ 1,124   $ 1,832   $ 1,310   $ 1,857
  Gold ($/oz.)   $ 1,692   $ 1,703   $ 1,659   $ 1,519
  Silver ($/oz.)   $ 32   $ 41   $ 31   $ 37
  Copper ($/lb.)   $ 3.34   $ 3.87   $ 3.42   $ 3.99
  Nickel ($/lb.)   $ 6.16   $ 8.39   $ 6.77   $ 9.70
                         
Average market price per ounce(3)                        
  Palladium ($/oz.)   $ 611   $ 753   $ 641   $ 768
  Platinum ($/oz.)   $ 1,496   $ 1,771   $ 1,535   $ 1,782
Combined ($/oz)(4)   $ 804   $ 970   $ 843   $ 981
                         
(1)   Ounces sold and average realized price per ounce from PGM recycling relate to ounces produced from processing of catalyst materials.
(2)   By-product metals sold reflect contained metal. Realized prices reflect net values (discounted due to product form and transportation and marketing charges) per unit received.
(3)   The Company's average realized price represents revenues, which include the effect of hedging gains and losses realized on commodity instruments and agreement discounts, divided by ounces sold. The average market price represents the average London Bullion Market Association afternoon postings for the actual months of the period.
(4)   The Company reports a combined average realized and a combined average market price of palladium and platinum at the same ratio as ounces that are produced from the base metal refinery.
(5)   Ounces sold and average realized price per ounce from Other relate to ounces purchased in the open market for resale.

Reconciliation of Non-GAAP Measures to Costs of Revenues

The Company utilizes certain non-GAAP measures as indicators in assessing the performance of its mining and processing operations during any period. Because of the processing time required to complete the extraction of finished PGM products, there are typically lags of one to three months between ore production and sale of the finished product. Sales in any period include some portion of material mined and processed from prior periods as the revenue recognition process is completed. Consequently, while costs of revenues (a GAAP measure included in the Company's Consolidated Statement of Operations and Comprehensive Income) appropriately reflects the expense associated with the materials sold in any period, the Company has developed certain non-GAAP measures to assess the costs associated with its producing and processing activities in a particular period and to compare those costs between periods. 

While the Company believes that these non-GAAP measures may also be of value to outside readers, both as general indicators of the Company's mining efficiency from period to period and as insight into how the Company internally measures its operating performance, these non-GAAP measures are not standardized across the mining industry and in most cases will not be directly comparable to similar measures that may be provided by other companies. These non-GAAP measures are only useful as indicators of relative operational performance in any period, and because they do not take into account the inventory timing differences that are included in costs of revenues, they cannot meaningfully be used to develop measures of earnings or profitability. A reconciliation of these measures to costs of revenues for each period shown is provided as part of the following tables, and a description of each non-GAAP measure is provided below.

Total Costs of Revenues: For the Company as a whole, this measure is equal to total costs of revenues, as reported in the Consolidated Statement of Operations and Comprehensive Income. For the Stillwater Mine, the East Boulder Mine, and other PGM activities, the Company segregates the expenses within total costs of revenues that are directly associated with each of these activities and then allocates the remaining facility costs included in total cost of revenues in proportion to the monthly volumes from each activity. The resulting total costs of revenues measures for Stillwater Mine, East Boulder Mine and other PGM activities are equal in total to total costs of revenues as reported in the Company's Consolidated Statement of Operations and Comprehensive Income.

Total Production Costs (Non-GAAP): Calculated as total costs of revenues (for each mine or combined) adjusted to exclude gains or losses on asset dispositions, costs and profit from recycling activities, revenues from the sale of mined by-products and timing differences resulting from changes in product inventories. This non-GAAP measure provides a comparative measure of the total costs incurred in association with production and processing activities in a period, and may be compared to prior periods or between the Company's mines.

When divided by the total tons milled in the respective period, Total Production Cost per Ton Milled (Non-GAAP) -- measured for each mine or combined -- provides an indication of the cost per ton milled in that period. Because of variability of ore grade in the Company's mining operations, production efficiency underground is frequently measured against ore tons produced rather than contained PGM ounces. Because ore tons are first actually weighed as they are fed into the mill, mill feed is the first point at which production tons are measured precisely. Consequently, Total Production Cost per Ton Milled (Non-GAAP) is a general measure of production efficiency, and is affected both by the level of Total Production Costs (Non-GAAP) and by the volume of tons produced and fed to the mill. 

When divided by the total recoverable PGM ounces from production in the respective period, Total Production Cost per Ounce (Non-GAAP) -- measured for each mine or combined -- provides an indication of the cost per ounce produced in that period. Recoverable PGM ounces from production are an indication of the amount of PGM product extracted through mining in any period. Because extracting PGM material is ultimately the objective of mining, the cost per ounce of extracting and processing PGM ounces in a period is a useful measure for comparing extraction efficiency between periods and between the Company's mines. Consequently, Total Production Cost per Ounce (Non-GAAP) in any period is a general measure of extraction efficiency, and is affected by the level of Total Production Costs (Non-GAAP), by the grade of the ore produced and by the volume of ore produced in the period.

Total Cash Costs (Non-GAAP): This non-GAAP measure is calculated by excluding the depreciation and amortization and asset retirement costs from Total Production Costs (Non-GAAP) for each mine or combined. The Company uses this measure as a comparative indication of the cash costs related to production and processing in any period. 

When divided by the total tons milled in the respective period, Total Cash Cost per Ton Milled (Non-GAAP) -- measured for each mine or combined -- provides an indication of the level of cash costs incurred per ton milled in that period. Because of variability of ore grade in the Company's mining operations, production efficiency underground is frequently measured against ore tons produced rather than contained PGM ounces. Because ore tons are first weighed as they are fed into the mill, mill feed is the first point at which production tons are measured precisely. Consequently, Total Cash Cost per Ton Milled (Non-GAAP) is a general measure of production efficiency, and is affected both by the level of Total Cash Costs (Non-GAAP) and by the volume of tons produced and fed to the mill. 

When divided by the total recoverable PGM ounces from production in the respective period, Total Cash Cost per Ounce (Non-GAAP) -- measured for each mine or combined -- provides an indication of the level of cash costs incurred per PGM ounce produced in that period. Recoverable PGM ounces from production are an indication of the amount of PGM product extracted through mining in any period. Because ultimately extracting PGM material is the objective of mining, the cash cost per ounce of extracting and processing PGM ounces in a period is a useful measure for comparing extraction efficiency between periods and between the Company's mines. Consequently, Total Cash Cost per Ounce (Non-GAAP) in any period is a general measure of extraction efficiency, and is affected by the level of Total Cash Costs (Non-GAAP), by the grade of the ore produced and by the volume of ore produced in the period.

Total Operating Costs (Non-GAAP): This non-GAAP measure is derived from Total Cash Costs (Non-GAAP) for each mine or combined by excluding royalty, tax and insurance expenses from Total Cash Costs (Non-GAAP). Royalties, taxes and insurance costs are contractual or governmental obligations outside of the control of the Company's mining operations, and in the case of royalties and most taxes, are driven more by the level of sales realizations rather than by operating efficiency. Consequently, Total Operating Costs (Non-GAAP) is a useful indicator of the level of production and processing costs incurred in a period that are under the control of mining operations. 

When divided by the total tons milled in the respective period, Total Operating Cost per Ton Milled (Non-GAAP) -- measured for each mine or combined -- provides an indication of the level of controllable cash costs incurred per ton milled in that period. Because of variability of ore grade in the Company's mining operations, production efficiency underground is frequently measured against ore tons produced rather than contained PGM ounces. Because ore tons are first actually weighed as they are fed into the mill, mill feed is the first point at which production tons are measured precisely. Consequently, Total Operating Cost per Ton Milled (Non-GAAP) is a general measure of production efficiency, and is affected both by the level of Total Operating Costs (Non-GAAP) and by the volume of tons produced and fed to the mill. 

When divided by the total recoverable PGM ounces from production in the respective period, Total Operating Cost per Ounce (Non-GAAP) -- measured for each mine or combined -- provides an indication of the level of controllable cash costs incurred per PGM ounce produced in that period. Recoverable PGM ounces from production are an indication of the amount of PGM product extracted through mining in any period. Because ultimately extracting PGM material is the objective of mining, the cost per ounce of extracting and processing PGM ounces in a period is a useful measure for comparing extraction efficiency between periods and between the Company's mines. Consequently, Total Operating Cost per Ounce (Non-GAAP) in any period is a general measure of extraction efficiency, and is affected by the level of Total Operating Costs (Non-GAAP), by the grade of the ore produced and by the volume of ore produced in the period.

   
   
Reconciliation of Non-GAAP Measures to Costs of Revenues
 
    Three Months Ended
September 30,
    Nine Months Ended
September 30,
 
(in thousands)   2012     2011     2012     2011  
Consolidated:                                
Reconciliation to consolidated costs of revenues:                                
Total operating costs (Non-GAAP)   $ 52,943     $ 44,212     $ 154,686     $ 130,966  
  Royalties, taxes and other     10,108       12,823       31,023       38,251  
Total cash costs (Non-GAAP)   $ 63,051     $ 57,035     $ 185,709     $ 169,217  
  Asset retirement costs     160       147       471       432  
  Depletion, depreciation and amortization     13,843       15,359       42,848       46,555  
  Depletion, depreciation and amortization (in inventory)     217       (580 )     (141 )     (1,670 )
Total production costs (Non-GAAP)   $ 77,271     $ 71,961     $ 228,887     $ 214,534  
  Change in product inventories     (2,764 )     2,068       973       (6,143 )
  Cost of PGM recycling     72,096       103,336       249,360       228,042  
  PGM recycling - depreciation     264       269       793       796  
  Add: Profit from by-products     7,212       8,969       23,563       24,508  
  Add: Profit from PGM recycling     2,034       4,508       8,360       11,147  
Total consolidated costs of revenues   $ 156,113     $ 191,111     $ 511,936     $ 472,884  
Stillwater Mine:                                
Reconciliation to costs of revenues:                                
Total operating costs (Non-GAAP)   $ 37,147     $ 30,686     $ 106,839     $ 94,963  
  Royalties, taxes and other     7,025       9,056       21,079       27,091  
Total cash costs (Non-GAAP)   $ 44,172     $ 39,742     $ 127,918     $ 122,054  
  Asset retirement costs     148       137       436       401  
  Depletion, depreciation and amortization     10,439       12,126       32,676       36,282  
  Depletion, depreciation and amortization (in inventory)     31       (513 )     (453 )     (637 )
Total production costs (Non-GAAP)   $ 54,790     $ 51,492     $ 160,577     $ 158,100  
  Change in product inventories     (2,206 )     1,666       1,088       (5,544 )
  Add: Profit from by-products     4,692       5,950       15,294       15,834  
  Add: Profit from PGM recycling     1,504       3,353       6,119       8,373  
Total costs of revenues   $ 58,780     $ 62,461     $ 183,078     $ 176,763  
East Boulder Mine:                                
Reconciliation to costs of revenues:                                
Total operating costs (Non-GAAP)   $ 15,796     $ 13,525     $ 47,848     $ 36,002  
  Royalties, taxes and other     3,083       3,767       9,943       11,160  
Total cash costs (Non-GAAP)   $ 18,879     $ 17,292     $ 57,791     $ 47,162  
  Asset retirement costs     12       11       35       32  
  Depletion, depreciation and amortization     3,404       3,233       10,173       10,273  
  Depletion, depreciation and amortization (in inventory)     186       (66 )     311       (1,032 )
Total production costs (Non-GAAP)   $ 22,481     $ 20,470     $ 68,310     $ 56,435  
  Change in product inventories     (558 )     (740 )     (115 )     (1,741 )
  Add: Profit from by-products     2,520       3,019       8,269       8,674  
  Add: Profit from PGM recycling     530       1,155       2,241       2,774  
Total costs of revenues   $ 24,973     $ 23,904     $ 78,705     $ 66,142  
PGM Recycling                                
Reconciliation to costs of revenues:                                
  Cost of open market purchases     -       1,141       -       1,141  
  PGM recycling - depreciation     264       269       793       796  
  Cost of PGM recycling     72,096       103,336       249,360       228,042  
Total costs of revenues   $ 72,360     $ 104,746     $ 250,153     $ 229,979  
                                 

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