Ssr Mining Reports Second Quarter 2017 Results
News Release 17-22
SSR Mining Inc. PHONE +1 604.689.3846 Suite 800 - 1055 Dunsmuir Street
www.ssrmining.com TOLL FREE +1 888.338.0046 PO Box 49088
Vancouver, BC, Canada V7X 1G4
August 9, 2017
SSR MINING REPORTS SECOND QUARTER 2017 RESULTS
VANCOUVER, B.C. - SSR Mining Inc. (NASDAQ: SSRM) (TSX: SSRM) (“SSR Mining”) reports
consolidated financial results for the second quarter ended June 30, 2017.
Paul Benson, President and CEO said, “We delivered another strong quarter as production
exceeded 100,000 gold equivalent ounces, which generated free cash flow to further strengthen
our balance sheet to over $350 million in cash. Pleasingly, we have improved guidance at all
operations after a strong first half and our confidence in the second half outlook. We continue to
deliver on our goals to create value and growth for shareholders through disciplined investment,
which now includes greenfields exploration and a third strong operating leg to our business, the
Puna Operations joint venture, in addition to our ongoing Operational Excellence initiatives."
Second Quarter 2017 Highlights:
(All figures are in U.S. dollars unless otherwise noted)
Continued strong financial performance: Attributable net income of $37.3 million or $0.31
per share and attributable adjusted net income of $13.0 million or $0.11 per share.
Increased cash generation: Quarter-end cash increased to $353.5 million, up $13.0 million,
from cash generated by operating activities of $38.6 million.
Continued strong production: Quarterly attributable production was 102,930 gold equivalent
ounces at cash costs of $682 and AISC of $889 per payable gold equivalent ounce sold.
Improved annual guidance: Production guidance improved at Seabee and Puna Operations
and cash costs guidance improved at Marigold and Puna Operations.
Increased tonnage at Marigold: Mined 18.0 million tonnes and stacked 6.9 million tonnes of
ore, both a quarter-on-quarter increase.
Gold production at Marigold on plan: Produced 55,558 ounces of gold at cash costs of $632
and AISC of $833 per payable ounce of gold sold.
Higher mill throughput at Seabee: Record monthly ore milled at approximately 1,050 tonnes
per day in June, supporting strong quarterly mill ore tonnage of 928 tonnes per day.
Robust gold production at Seabee: Produced 20,690 ounces of gold at cash costs of $592
and AISC of $831 per payable ounce of gold sold.
Exceeded planned operating performance at Pirquitas: Produced 1.9 million ounces of
silver, 28% higher than in the first quarter, contributing to lower quarterly cash costs of $12.15
and AISC of $12.78 per payable ounce of silver sold.
SSR Mining Inc. PAGE 2
Extended Pirquitas operating life: Formed Puna Operations joint venture comprised of our
Pirquitas property and Golden Arrow's Chinchillas project whereby we are the operator with a
75% interest.
Marigold mine, U.S.
Three months ended
Operating data
June 30
2017
March 31
2017
December
31 2016
September
30 2016
June 30
2016
Total material mined (kt) 17,985 16,736 19,559 19,558 18,685
Waste removed (kt) 11,075 11,062 13,123 14,741 12,005
Total ore stacked (kt) 6,910 5,674 6,436 4,817 6,680
Strip ratio 1.6 1.9 2.0 3.1 1.8
Mining costs ($/t mined) 1.67 1.65 1.52 1.48 1.55
Gold stacked grade (g/t) 0.31 0.42 0.48 0.42 0.44
Processing costs ($/t processed) 0.82 0.89 0.80 0.95 0.70
Gold recovery (%) 73.0 74.0 75.0 71.0 70.7
General and admin costs ($/t processed) 0.42 0.52 0.46 0.56 0.38
Gold produced (oz) 55,558 55,215 59,945 47,456 47,195
Gold sold (oz) 57,426 52,528 61,308 47,278 47,124
Realized gold price ($/oz) (1) 1,265 1,214 1,247 1,330 1,259
Cash costs ($/oz) (1) 632 585 585 636 663
AISC ($/oz) (1) 833 799 835 1,139 1,067
Financial data ($000s)
Revenue 72,451 63,762 77,047 62,831 59,197
Income from mine operations 21,373 21,327 28,648 23,156 17,641
Capital expenditures 5,272 3,043 3,271 8,310 10,154
Capitalized stripping 4,350 6,745 10,171 13,787 7,231
Exploration expenditures (2) 1,538 1,024 1,276 1,145 1,597
(1) We report the non-GAAP financial measures of realized gold prices, cash costs and all-in sustaining costs ("AISC") per payable
ounce of gold sold to manage and evaluate operating performance at the Marigold mine. For a better understanding and a reconciliation
of these measures to cost of sales, as shown in our consolidated interim statements of comprehensive income (loss), please refer
to “Non-GAAP and Additional GAAP Financial Measures” in section 12 of our management's discussion and analysis of the financial
position and results of operation for the three and six months ended June 30, 2017 ("MD&A").
(2) Includes capitalized and expensed exploration expenses.
Mine production
In the second quarter of 2017, the Marigold mine produced 55,558 ounces of gold, in line with the
previous quarter production.
A total of 18.0 million tonnes were mined in the second quarter of 2017, 7% more than the first quarter
of 2017, primarily due to improved weather conditions. Approximately 6.9 million tonnes of ore were
delivered to the heap leach pads at an average gold grade of 0.31 g/t as we completed the current
SSR Mining Inc. PAGE 3
mining phase at the Mackay pit. This compares to 5.7 million tonnes of ore delivered to the heap
leach pads at a gold grade of 0.42 g/t in the first quarter of 2017. Gold grade mined in the second
quarter was 26% lower than the first quarter due to planned pit phase sequencing and mining a
higher amount of lower-grade ore as we completed the deeper phase of the Mackay pit. The strip
ratio declined to 1.6:1 in the quarter, an 18% reduction compared to the previous quarter.
Mine operating costs
Cash costs and AISC per payable ounce of gold sold are non-GAAP financial measures. Please see
“Cautionary Note Regarding Non-GAAP Measures”.
Cash costs, which include all costs of inventory, refining costs and royalties, of $632 per payable
ounce of gold sold in the second quarter of 2017 was 8% higher than the first quarter as higher
tonnes stacked were at lower grade resulting in more operating costs being recognized against a
similar number of ounces stacked. Total mining costs of $1.67 per tonne were similar to the first
quarter primarily due to the timing of maintenance repairs on mobile equipment offset by a 7%
increase in total tonnes mined. During the second half of the year, mining will benefit from a short
waste haul to an exhausted pit, which we believe should increase mining efficiency and lead to a
reduction in unit cost per tonne mined through the second half of 2017. Processing unit costs were
8% lower in the second quarter of 2017 than in the first quarter of 2017 due to the increase in tonnes
stacked. General and administrative unit costs were also lower in the second quarter of 2017 than
in the first quarter due to the increase in tonnes stacked but were comparable on an absolute basis.
AISC of $833 per payable ounce of gold sold in the second quarter of 2017 increased from $799 in
the first quarter of 2017 predominantly due to higher cash costs as noted above.
Mine sales
A total of 57,426 ounces of gold were sold at an average price of $1,265 per ounce during the second
quarter of 2017, compared to 52,528 ounces of gold sold at a 4% lower average price of $1,214 per
ounce during the first quarter of 2017.
Exploration
Exploration activities maintained momentum on Mineral Resource to Mineral Reserve conversion
with the objective of maximizing Mineral Reserve growth in proximity to existing open pit reserves.
During the period we completed 15,300 meters of drilling in 55 reverse circulation holes as part of
our planned $5.0 million exploration expenditure at the site for 2017. Drilling was conducted at the
Mackay Pit, East Basalt, and North Red Dot targets, with the former two areas representing Mineral
Reserve addition opportunities and the latter being a Mineral Resource addition opportunity.
Drilling at depth in the Mackay Pit and at East Basalt intersected gold mineralization adjacent to the
existing Mineral Reserves pit outline that is expected to expand Mineral Resources.
In the second quarter of 2017, we received results from four drillholes at North Red Dot. Structural
and compilation work completed early in the year was tested in the second quarter confirming
continuity of mineral controlling fault systems. We plan to complete additional drilling with the
objective of defining a Mineral Resource in this area in the third quarter of 2017.
SSR Mining Inc. PAGE 4
As part of our deep sulphide exploration program, we completed and received analytical results from
one core hole collared in the southern part of the Marigold property during the quarter. Drillhole
DDH-6421 intercepted 0.39 g/t gold over 43 meters including 0.15 meters grading 9.86 g/t gold in a
sheared carbonaceous mudstone approximately 700 meters below surface. Refer to Table 1 at the
end of this news release for drillhole results. This is our first encounter with mineralized mudstone
lithology typically associated with high grade deposits in Carlin-type systems. We view the result as
encouraging and will review all the data from the deep sulphide exploration program to determine if
follow up holes will be drilled in the second half of 2017.
SSR Mining Inc. PAGE 5
Seabee Gold Operation, Canada
Three months ended
Operating data June 30
2017
March 31
2017
December 31
2016
September 30
2016
Period from
Acquisition to June
30, 2016 (1)
Total ore milled (t) 84,469 72,394 84,526 82,756 18,856
Ore milled per day (t/day) 928 804 919 900 629
Gold mill feed grade (g/t) 7.97 9.22 7.40 7.40 7.79
Mining costs ($/t mined) 60 68 62 58 110
Processing costs ($/t
processed) 20 23 19 19 29
Gold recovery (%) 97.3 97.7 97.0 96.5 96.6
General and admin costs
($/t processed) 50 59 44 37 61
Gold produced (oz) 20,690 21,023 19,711 20,142 6,721
Gold sold (oz) 17,909 22,411 17,229 21,911 11,306
Realized gold price ($/oz) (2) 1,257 1,233 1,230 1,334 1,278
Cash costs ($/oz) (2, 4) 592 574 595 661 663
AISC ($/oz) (2, 4) 831 990 833 841 776
Financial data ($000s)
Revenue 22,502 27,609 21,175 29,214 14,437
Income from mine
operations 4,083 4,995 2,864 4,126 1,216
Capital expenditures 711 4,760 1,010 579 337
Capitalized development 2,165 2,514 2,432 2,104 803
Exploration expenditures (3) 1,566 1,953 829 1,206 117
(1) The data presented in this column is for the period from May 31, 2016 to June 30, 2016, the period for which we were entitled to all
economic benefits of the Seabee Gold Operation following our acquisition of SGO Mining Inc. (formerly Claude Resources Inc.)
("SGO Mining").
(2) We report the non-GAAP financial measures of realized gold prices, cash costs and AISC per payable ounce of gold sold to manage
and evaluate operating performance at the Seabee Gold Operation. For a better understanding and a reconciliation of these measures
to cost of sales, as shown in our consolidated interim statements of comprehensive income (loss), please refer to “Non-GAAP and
Additional GAAP Financial Measures” in section 12 of our MD&A.
(3) Includes capitalized and expensed exploration expenses.
(4) The non-GAAP financial measures of cash costs per payable ounce of gold sold and AISC per payable ounce of gold sold from the
Seabee Gold Operation were adjusted to eliminate the adjustment of inventory to fair value as at the date of our acquisition of SGO
Mining.
Mine production
In the second quarter of 2017, the Seabee Gold Operation produced 20,690 ounces of gold.
A near-quarterly record 84,469 tonnes of ore were milled at an average gold grade of 7.97 g/t during
the second quarter of 2017. This compares to a total of 72,394 tonnes of ore at an average gold
grade of 9.22 g/t in the first quarter. Ore was mined at both the Santoy and Seabee mines with lower
SSR Mining Inc. PAGE 6
grade ore at Seabee reducing the overall average mill grade during the second quarter. The Santoy
mine complex supplied 76% of ore milled, predominantly from long hole stopes. Gold recovery
remained relatively consistent at 97.3% in the current quarter.
Stope production at Santoy was impacted by a fall of ground early in the second quarter. While there
were no injuries to people or damage to equipment, restrictions were put in place until a full review
of the ground support in the area was completed. These self-imposed restrictions had the effect of
reducing tonnage and grade to the plant during the quarter. Following modifications to the support
design and installation, production from Santoy returned to planned levels in June.
During the second quarter, the mill achieved a record average throughput of 928 tonnes per day,
15% higher than the previous quarter, with a monthly record of 1,049 tonnes per day milled in June,
as the site focused on Operational Excellence initiatives to deliver and process more ore tonnage.
Mine operating costs
Cash costs and AISC per payable ounce of gold sold are non-GAAP financial measures. Please see
“Cautionary Note Regarding Non-GAAP Measures”.
Cash costs per payable ounce of gold sold, which include all costs of inventory, refining costs and
royalties, were $592 in the second quarter of 2017, higher than the $574 in the first quarter of 2017.
Costs per tonne mined were $60 in the second quarter of 2017, 12% lower than in the previous
quarter due to higher tonnes mined. Processing and general and administration unit costs were lower
by 13% and 15%, respectively, in the second quarter of 2017 compared to the first quarter of 2017
due to higher tonnes milled; however, the mill feed grade was 14% lower in the current quarter than
in the preceding period with lower production resulting in higher cash costs in the period.
AISC per payable ounce of gold sold were $831 in the second quarter of 2017, lower than the $990
in the first quarter of 2017 when a significant portion of planned capital spending was incurred due
to the delivery of capital items over the ice road. Exploration spending also decreased, but spending
is consistent with our objective of adding Mineral Reserves and Mineral Resources at the mine.
Mine sales
A total of 17,909 ounces of gold were sold at an average price of $1,257 per ounce during the second
quarter of 2017 due to a buildup in finished goods inventory, 20% lower than the 22,411 ounces of
gold sold at a comparable price of $1,233 per ounce in the first quarter of 2017.
Exploration
Exploration drilling remained focused on Mineral Resource upgrade and conversion. In the second
quarter of 2017, we completed 16,400 meters of underground and 9,700 meters of surface drilling.
Underground drilling was active at both mine operations with the majority of expenditures at the
Santoy mine.
Results received during the quarter have been successful at extending existing mineralization at
Santoy Gap up to 200 meters down plunge and still remains open at depth and laterally. Drill results
at Santoy 8A have converted a significant area of Inferred Mineral Resources to Indicated Mineral
Resources, and expanded the scope of Inferred Mineral Resources at depth. As a result, we expect
to increase Mineral Reserves in this area to be reported in February 2018. At the Seabee Mine we
SSR Mining Inc. PAGE 7
completed drill programs on three targets which resulted in an incremental addition to Mineral
Resources.
Greenfields exploration on the Seabee property resulted in more positive results at the Carr target,
which is the northern extension of the Santoy shear zone located four kilometers north from Santoy
Gap. Late in the first quarter of 2017, we completed 9 drillholes as follow up to investigate a gold
bearing alteration zone with characteristics similar in nature to Santoy Gap. During the second quarter
of 2017 we received encouraging results with our first high grade intercept at Carr. Drilling is planned
to investigate this new discovery further during the 2018 winter drilling season.
At the Fisher property, where we have an option agreement to acquire up to an 80% interest on the
adjacent 34,000 hectares south of the Santoy mine, we mobilized one drill rig to conduct systematic
exploration on the southern extension of the Santoy shear zone as well as other existing gold
occurrences identified by previous programs. By the end of the second quarter of 2017, a camp was
established and field work is underway. Drilling is expected to begin later in the third quarter of 2017.
SSR Mining Inc. PAGE 8
Puna Operations, Argentina (75% interest)
(Amounts presented on a 100% basis unless otherwise stated)
Three months ended
Operating data
June 30
2017
March 31
2017
December 31
2016
September 30
2016
June 30
2016
Ore milled (kt) 446 449 476 455 425
Silver mill feed grade (g/t) 185 145 194 264 238
Processing costs ($/t milled) 12.94 13.66 14.17 14.78 15.10
Silver recovery (%) 73.5 72.6 74.5 79.0 77.6
General and admin costs ($/t milled) 5.00 5.22 6.19 5.84 6.22
Silver produced ('000 oz) 1,947 1,520 2,210 3,047 2,526
Silver produced (attributable) ('000 oz) (1) 1,777 1,520 2,210 3,047 2,526
Silver sold ('000 oz) 1,655 1,443 2,633 2,947 2,594
Silver sold (attributable) ('000 oz) (1) 1,473 1,443 2,633 2,947 2,594
Realized silver price ($/oz) (2) 17.31 17.35 17.14 19.64 16.52
Cash costs ($/oz) (2) 12.15 12.68 9.80 8.48 8.87
AISC ($/oz) (2) 12.78 14.82 11.47 9.87 10.00
Financial Data ($000s)
Revenue 22,029 26,534 29,095 51,336 45,141
Income (loss) from mine operations (3) 4,006 13,767 (4,056) 31,908 25,205
Capital expenditures 420 2,261 3,467 3,158 2,057
Exploration expenditures (4) — — 11 7 25
(1) Attributable production and sales figures for the second quarter of 2017 represent 100% for April and May 2017 and 75% for June
2017.
(2) We report the non-GAAP financial measures of cash costs per payable ounce of silver sold, realized silver prices and AISC to manage
and evaluate operating performance at Puna Operations Inc. ("Puna Operations"). For a better understanding and a reconciliation
of these measures to cost of sales, as shown in our consolidated interim statements of comprehensive income (loss), please refer
to “Non-GAAP and Additional GAAP Financial Measures” in section 12 of our MD&A.
(3) The income from mine operations for the quarter ended March 31, 2017 includes a non-cash impact of $4.3 million relating to the
resolution of the export duty claim in Argentina. Income (loss) from mine operations for the quarter ended December 31, 2016,
includes $5.7 million of severance provision and a non-cash write-down of supplies inventory and VAT receivable of $3.7 million.
(4) Does not include exploration or development of the Chinchillas project.
Mine production
The operation produced a total of 1.9 million ounces of silver from processing of stockpiles, a 28%
increase compared to the first quarter of 2017.
Ore was milled at an average rate of 4,903 tonnes per day in the second quarter, 23% above the
mill’s nominal throughput of 4,000 tonnes per day. Ore milled in the second quarter of 2017 contained
an average silver grade of 185 g/t, 28% higher than the 145 g/t reported in the first quarter of 2017
due to better than expected grades in the stockpiles. The average silver recovery in the second
quarter was 73.5%, higher than the 72.6% recovery in the previous quarter, in line with the higher
silver mill feed grade.
We finalized our joint venture, Puna Operations, to combine the Pirquitas mine with Golden Arrow
Corporation's ("Golden Arrow") Chinchillas project on May 31, 2017. The joint venture is comprised
of our Pirquitas property and the Chinchillas project and is owned on a 75%/25% basis by each
company, respectively. We are the joint venture operator. As a result of the joint venture, our