Coeur Mining, Inc. (NYSE:CDE) Q1 2023 Earnings Conference Call May 11, 2023 11:00 AM ET

Company Participants

Mitchell Krebs - President and Chief Executive Officer

Michael Routledge - Senior Vice President and Chief Operating Officer

Thomas Whelan - Senior Vice President and Chief Financial Officer

Conference Call Participants

Mark Reichman - Noble Capital Markets

Michael Siperco - RBC Capital Markets

Operator

Good morning and welcome to the Coeur Mining First Quarter 2023 Financial Results Conference Call. [Operator Instructions] Please also note, that today, this event is being recorded.

I would now like to turn the conference over to the President and Chief Executive Officer, Mitch Krebs. Please go ahead, sir.

Mitchell Krebs

Good day, everyone. Before I 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 start with the main highlights on Slide 3 before turning the call over to Mick and Tom. Our results were slightly ahead of expectations, driven by strong start to the year at our Palmarejo, Rochester and Wharf operations, which offset a weaker quarter from our Kensington mine. As we have said, the first quarter is typically our softest quarter of the year, due to weather and one-time payments. Overall, we remain on-track to deliver on our full year guidance, which reflects a much stronger second half. That stronger expected second half is mostly driven by the post expansion ramp up of our Rochester mine out in Nevada, which remains on track for a mid-year construction completion. We are currently in the middle of the final quarter of elevated capital spending, as we make the final push to wrap it up and the balance sheet remains well-positioned to deliver what remains to be spent.

Seeing the goal line at Rochester just ahead, represents a key inflection point for the company, as we anticipate capital outflows to decline, silver and gold production levels to rise and cash flow to begin increasing. The Rochester expansion has represented a significant investment for the company and will result in one of the world's largest open pit heap leach operations. The team has done an amazing job, especially considering everything they have managed through. The project kicked off in May of 2020, was advanced throughout COVID-related restrictions, faced constant logistical and supply chain disruptions, battled decades high levels of inflation and labor shortages, and most recently, experienced one of the most extreme winters in recent years in Northern Nevada. Despite all of that, the team achieved mechanical completion of the Merrill-Crowe processing facility ahead of schedule during the first quarter, and even more impressively, the project is now approaching 2 million hours without a lost time incident.