Coeur Mining, Inc. (NYSE:CDE) Q4 2023 Earnings Call Transcript
Coeur Mining, Inc. (NYSE:CDE) Q4 2023 Earnings Call Transcript February 22, 2024
Coeur Mining, Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Good morning, everyone, and welcome to the Coeur Mining Fourth Quarter 2023 Financial Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] Please also note, today's event is being recorded. At this time, I'd like to turn the floor over to Mitchell Krebs, President and CEO. Sir, please go ahead.
Mitchell Krebs: Hi, everyone. Thank you for joining our call. Before we begin, please note our cautionary language on forward-looking statements in today's slide deck and refer to our SEC filings on our website. I'll kick off with a quick overview on Slide 3 before turning the call over to some of the team who are here with me. By nearly every metric, Coeur’s fourth quarter represented our strongest quarter of 2023. In fact, it was our strongest quarter in over three years. Revenues jumped 35% based on 29% higher gold production and 34% higher silver production. This led to a more than doubling of adjusted EBITDA and fourth quarter operating cash flow, which reached its highest level since late 2020. These results were driven largely by the stepped-up production levels at the expanded Rochester operation and by a strong finish to the year at Wharf.
Kensington and Palmarejo also delivered consistent results to end the year, which enabled the company to achieve its full year production guidance. Rochester's fourth quarter provided a glimpse of what the expanded mine is capable of delivering once operating at full strength. Based on expected throughput rates of over 32 million tonnes per year, Rochester will be one of the world's largest operations of its kind and will be the largest source of American produced and refined silver. Mick will provide an update on Rochester in a few minutes. A year ago, I spoke on this call about our expectations for a strong bounce back year at Wharf in 2023, and I'm happy to say that's exactly what the team delivered. Free cash flow reached $27 million in the fourth quarter and $82 million for the year from 94,000 ounces of gold production.
As you can see on Slide 12, cumulative free cash flow since we purchased Wharf nine years ago has now topped the $400 million mark, which is over four times our acquisition price. When we acquired Wharf, it had an estimated remaining mine life of about five years and today, after over 800,000 ounces of production, Wharf's reserves stand at over 760,000 ounces of gold with further exploration upside. I also want to offer a few quick comments on our year end reserve and resource update we provided earlier this week, which is summarized on Slide 10. Our roughly $245 million investment in exploration over the past five years continues to deliver tremendous results. It remains a key differentiator for Coeur at a time when many companies in the sector have underinvested in this critical component of the business.
Over the past five years, we've produced roughly 1.7 million ounces of gold and also managed to add 400,000 ounces to our reserves, which now stand at over 3 million ounces of gold. For silver, we've added 73 million ounces of reserves in addition to producing over 51 million ounces over the past five years, with our current silver reserves now approaching nearly 250 million ounces. In addition to reserve growth, our gold and silver M&I resources have increased by approximately 45% and 59% respectively over the past five years. Aoife will provide additional color in a few minutes, including providing some highlights on our 2024 exploration priorities. Before turning the call over to Mick, I want to thank our entire team for their commitment and dedication last year, which has led the company to be very well positioned not only for this year, but well into the future.
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