Ssr Mining Reports Third Quarter 2019 Results
News Release 19-23
November 5, 2019
SSR MINING REPORTS THIRD QUARTER 2019 RESULTS
VANCOUVER, B.C. - SSR Mining Inc. (NASDAQ: SSRM) (TSX: SSRM) (“SSR Mining”) reports
consolidated financial results for the third quarter ended September 30, 2019.
Paul Benson, President and CEO said, "We delivered another strong quarter, with increased
production at lower cash costs, which positions us well to meet or exceed guidance for the eighth
consecutive year. Our strong operating performance resulted in improved margins, earnings,
operating cash flow and free cash flow. Notably, we have an incredibly strong financial position with
over half a billion dollars in cash and marketable securities.”
Third Quarter 2019 Highlights:
(All figures are in U.S. dollars unless otherwise noted)
▪ Strong financial performance: Reported positive income from mine operations at all
operations totaling $51.9 million, net income of $18.1 million and adjusted attributable net
income of $28.4 million, or $0.23 per share. (1)
▪ On track for higher annual gold equivalent production: Achieved quarterly consolidated
production of 104,775 gold equivalent ounces at cash costs of $759 per payable ounce of gold
sold. (1)
▪ Record production and cash costs at the Seabee Gold Operation: Produced a record
32,345 ounces of gold at record low cash costs of $373 per payable ounce of gold sold under
SSR Mining management. (1) Achieved higher gold recovery of 98.8% and gold grade of 12.4
g/t, quarterly records for the operation under our ownership.
▪ Strong operating performance at the Marigold mine: Produced 52,968 ounces of gold at
lower cash costs of $822 per payable ounce of gold sold. Stacked 6.4 million tonnes of ore at a
higher quarterly gold grade of 0.51 g/t. (1) Total material mined was over 19 million tonnes,
continuing to demonstrate strong and efficient operating practices.
▪ Improved production at Puna Operations: Increased silver mill feed grade and recovery led
to 1.7 million ounces of silver production at cash costs of $14.22 per payable ounce of silver
sold. (1) Ore mined was significantly higher than ore milled, increasing the stockpile in advance
of the rainy season.
▪ Exploration success at Marigold's Red Dot deposit: We expect to extend the current
Marigold life of mine plan into the early 2030s with Red Dot phases 1, 2 and 3.
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▪ Maintained strong balance sheet and liquidity: Increased cash balance to $474 million and
total liquidity of approximately $526 million including our marketable securities.
▪ Consolidated 100% ownership in Puna Operations: Completed acquisition of the remaining
25% interest in Puna Operations leading to an immediate increase in silver production profile
and improved operational flexibility.
▪ Exercised equity participation right in SilverCrest Metals financing: Maintaining our 9.8%
interest and exposure to the high grade Las Chispas project.
▪ Marigold mine EIS permit received: Subsequent to September 30, 2019, Marigold received a
positive Record of Decision on its Environmental Impact Statement ("EIS"). The receipt of the
EIS permits the expansion of mining, including Red Dot and its associated facilities.
(1) We report the non-GAAP financial measures of adjusted net income and cash costs per payable ounce of gold and silver sold to
manage and evaluate operating performance at the Marigold mine, the Seabee Gold Operation and Puna Operations. Please see
“Cautionary Note Regarding Non-GAAP Measures”.
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Marigold mine, U.S.
Three months ended
Operating data
September 30
2019
June 30
2019
March 31
2019
December 31
2018
September 30
2018
Total material mined (kt) 19,033 19,254 17,295 17,039 21,284
Waste removed (kt) 12,676 12,185 11,767 11,361 14,411
Total ore stacked (kt) 6,357 7,070 5,528 5,679 6,873
Gold stacked grade (g/t) 0.51 0.38 0.34 0.34 0.32
Gold recovery (%) 77.0 75.0 73.0 72.9 72.3
Strip ratio 2.0 1.7 2.1 2.0 2.1
Mining cost ($/t mined) 1.73 1.65 1.73 1.86 1.51
Processing cost ($/t processed) 1.17 1.01 1.20 1.27 1.12
General and administrative costs
($/t processed) 0.54
0.47
0.54
0.51
0.50
Gold produced (oz) 52,968 54,922 53,151 54,306 58,459
Gold sold (oz) 50,650 59,702 55,517 50,550 59,612
Realized gold price ($/oz) (1) 1,481 1,309 1,303 1,227 1,207
Cash costs ($/oz) (1) 822 835 812 760 711
AISC ($/oz) (1) 1,104 986 930 963 927
Financial data ($000s)
Revenue 74,820 78,039 72,263 61,861 71,848
Income from mine operations 22,064 13,939 12,981 9,977 13,254
Capital expenditures (2) 10,496 6,924 3,167 8,328 25,461
Capitalized stripping 2,031 871 2,293 1,208 2,529
Exploration expenditures (3) 1,990 2,452 3,653 2,096 2,956
(1) We report the non-GAAP financial measures of realized gold price, cash costs and all-in sustaining costs ("AISC") per
payable ounce of gold sold to manage and evaluate operating performance at the Marigold mine. See “Cautionary
Note Regarding Non-GAAP Measures”.
(2) Includes expansionary capital expenditure of $16 million in the third quarter of 2018. Excludes capitalized exploration
expenditures.
(3) Includes capitalized and expensed exploration expenditures.
Mine production
In the third quarter of 2019, the Marigold mine produced 52,968 ounces of gold, a 4% decrease
from the second quarter of 2019, as ores were stacked higher up on the leach pad to allow for the
appropriate leach cycle on ores previously stacked at lower elevations. Gold sales for the t hird
quarter totaled 50,650 ounces, 15% lower than the previous quarter, due to lower gold production
and a significant inventory drawdown in the second quarter of 2019.
During the third quarter of 2019, 19.0 million tonnes of material were mined, in line with the second
quarter of 2019. Approximately 6.4 million tonnes of ore were delivered to the heap leach pads at a
grade of 0.51 g/t gold in the quarter. This compares to 7.1 million tonnes of ore delivered to the
heap leach pads at a gold grade of 0.38 g/t in the second quarter of 2019. The gold grade to the
SSR Mining Inc. PAGE 4
leach pads was 34% higher compared to the prior quarter, consistent with plan, as we mined higher
grade ore in the current phase of the Mackay pit.
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 of $822 per payable ounce of gold sold in the third quarter of 2019 were 2% lower than
the previous quarter. This was primarily due to more ounces stacked in the quarter due to higher
grade combined with an increase in deferred stripping in the third quarter compared to the second
quarter, offset partially by lower gold ounces sold. Total mining costs of $1.73 per tonne in the third
quarter of 2019 were 5% higher than in the previous quarter primarily due to higher tire and fuel
operating costs in the haul fleet. Processing and general and administrative unit costs were 16%
and 15% higher, respectively, in the third quarter of 2019 than in the second quarter, due to fewer
tonnes stacked while total spend remained stable.
AISC per payable ounce of gold sold increased in the third quarter of 2019 to $1,104 from $986 in
the second quarter, due to higher planned sustaining capital expendi tures on processing facility
upgrades, leach pad expansion, deferred stripping and capitalized maintenance components.
Mine sales
Average realized gold price is a non -GAAP financial measure. Please see “Cautionary Note
Regarding Non-GAAP Measures”.
A total of 50,650 ounces of gold were sold at an average realized gold price of $1,481 per ounce
during the third quarter of 2019, a decrease of 15% from the 59,702 ounces of gold sold at an
average realized gold price of $1,309 per ounce during the second quarter of 2019. The decrease in
ounces sold was primarily due to a build-up of inventory available for sale compared to the prior
quarter.
Permitting
On October 30, 2019, Marigold received a positive Record of Decision (“ROD”) from the Bureau of
Land Management regarding the new Marigold environmental impact statement. The receipt of the
ROD permits mining of the Mackay open pit mineral resource complex including Red Dot and
associated features such as leach pads and dumps. Further permitting will be requir ed to mine
Mineral Reserves and Resources at Valmy, Trenton Canyon and Buffalo Valley.
Exploration
The main focus of our 2019 exploration program at Marigold has been to increase Red Dot Mineral
Reserves. In addition, we have continued exploration drilling for additional Mineral Resources north
and south of Red Dot, in the Mackay pit and at Valmy, Crossfire and East Basalt areas. During the
third quarter of 2019, we completed a total of 51 reverse circulation drillholes for 17,000 meters on
these targets.
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During 2019, our Red Dot exploration program focused on geotechnical drilling and engineering
with the goal of declaring additional Mineral Reserves at Red Dot. In the third quarter of 2019, we
completed preliminary pit designs and related economic evaluations at Red Dot. These evaluations
were completed with strict economic return and investment thresholds and were based on current
assumptions, which include a gold price of $1,250 per ounce. Based on the results of these
evaluations, Red Dot is anticipated to extend the Marigold mine life into the early 2030s, without
requiring expansion of the haul fleet or the associated expansion capital.
Also, at Marigold, infill drill results for the Mackay pit and the North and South Red Dot areas are
expected to add to Mineral Reserves and Mineral Resources at year -end 2019. Additional
information regarding our Marigold exploration program was published in our news release dated
July 30, 2019 (which, for greater certainty, is not incorporated by reference herein).
Exploration and permitting activities are scheduled through the fourth quarter of 2019 at the Mackay
pit, North and South Red Dot, Valmy, East Basalt, and the newly acquired Trenton Canyon areas,
aimed at extending known gold mineralization and discovery. During the third quarter of 2019, we
began the first phase of our exploration program at the Trenton Canyon property, which is located
immediately south of and adjacent to Marigold.
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Seabee Gold Operation, Canada
Three months ended
Operating data
September 30
2019
June 30
2019
March 31
2019
December 31
2018
September 30
2018
Total ore milled (t) 77,465 88,424 90,756 86,447 88,273
Ore milled per day (t/day) 842 971 1,008 940 959
Gold mill feed grade (g/t) 12.39 9.83 8.59 10.20 9.52
Gold recovery (%) 98.8 98.4 97.2 97.6 97.1
Mining costs ($/t mined) 61 53 52 57 48
Processing costs ($/t processed) 28 35 28 26 26
General and administrative costs
($/t processed) 59
50
53
63
47
Gold produced (oz) 32,345 26,539 31,183 20,473 27,831
Gold sold (oz) 28,278 24,276 27,999 21,711 29,175
Realized gold price ($/oz) (1) 1,480 1,329 1,302 1,236 1,210
Cash costs ($/oz) (1) 373 526 467 502 447
AISC ($/oz) (1) 715 828 947 728 591
Financial data ($000s)
Revenue 41,331 32,237 36,431 26,890 35,270
Income from mine operations 22,134 11,762 13,672 7,347 11,061
Capital expenditures 5,406 3,358 8,772 625 968
Capitalized development 3,352 3,345 3,379 2,910 1,812
Exploration expenditures (2) 2,131 2,257 3,172 1,661 2,860
(1) We report the non-GAAP financial measures of realized gold price, cash costs and AISC per payable ounce of gold
sold to manage and evaluate operating performance at the Seabee Gold Operation. See “Cautionary Note
Regarding Non-GAAP Measures”.
(2) Includes capitalized and expensed exploration expenditures.
Mine production
The Seabee Gold Operation produced 32,345 ounces of gold in the third quarter of 2019, a 22%
increase from the second quarter, mainly due to higher mill feed head grade and the sale of 1,244
ounces as a result of sludge, fines and cathodes recovered during the third quarter of 2019. Gold
sales totaled 28,278 ounces for the third quarter of 2019, an increase of 17% from the secon d
quarter.
The mill achieved an average throughput of 842 tonnes per day over the third quarter, a 13%
decline compared to the previous quarter largely due to a power outage caused by electrical
transformer damage resulting from lightning strikes. Gold mill feed grade was 12.39 g/t, 25% higher
compared to the second quarter due to the mining of higher grade stopes. Gold recovery for the
third quarter was 98.8%, in-line with the second quarter.
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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 were $373 in the third quarter of 2019, lower than the
$526 in the second quarter of 2019. Lower cash costs per payable ounce sold were primarily the
result of producing and selling more ounces due to higher grades. Total mining costs were $61 per
tonne in the third quarter of 2019, higher than the previous quarter, resulting from reduced tonnage
from the mine p artially due to a power outage caused by lightning strikes discussed above.
Processing unit costs decreased by 20% in the third quarter of 2019 compared to the second
quarter of 2019, but consistent with the first quarter of 2019. The reclassification of certain costs
incurred in the first half of the year to capital costs in the third quarter of 2019 impacted processing
costs. General and administrative costs per tonne increased by 18% in the third quarter of 2019
compared to the second quarter of 2019, mainly due to an increase in insurance premiums.
AISC per payable ounce of gold sold were $715 in the third quarter of 2019, 14% lower than the
$828 in the second quarter of 2019. This decrease was primarily due to lower cash costs and an
increase in payable ounces sold for the quarter, offset by higher capital expenditures due mainly to
the Tailings Management Facility expansion.
Mine sales
Average realized gold price is a non -GAAP financial measure. Please see “Cautionary Note
Regarding Non-GAAP Measures”.
A total of 28,278 ounces of gold were sold at an average realized gold price of $1,480 per ounce
during the third quarter of 2019, compared to 24,276 ounces of gold sold in the second quarter of
2019, at an average realized gold price of $1,329 per ounce of gold. Gold sales by volume for the
third quarter were 16% higher than the second quarter primarily due to higher production as a result
of higher gold grades.
Exploration
In 2019, the Seabee Gold Operation planned 45,000 meters of underground drill ing and 15,000
meters of surface drilling with the objective to increase and convert Mineral Resources into Mineral
Reserves near the Santoy mine. During the third quarter of 2019, close to the Santoy mine area, we
completed 13,732 meters of underground drilling in 46 reported drillholes. Our underground drill
activities focused mainly on Santoy Gap hanging wall ("Gap HW") with a smaller number of holes
completed on the Santoy Gap and Santoy 8A zones. Additional information regarding our Seabee
exploration program was published in our news release dated July 30, 2019 (which, for greater
certainty, is not incorporated by reference herein). We anticipate that Gap HW will make a positive
contribution to Mineral Resources when estimated and reported at year-end 2019.
Greenfields exploration at the Seabee Gold Operation and Fisher property intersected new
mineralized zones at the Batman Lake and Mac targets, respectively, where we are targeting new
gold discoveries.
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In addition, exploration field activities outside the immediate Santoy mine area began in June and
continued through the third quarter of 2019. These are now complete for the season and were
focused on Mineral Resource discovery at the Seabee Gold Operation and the Fisher project. This
work comprised field programs of soil geochemistry, prospecting, trenching, and geologic mapping
conducted from fly -in camps located along the Santoy shear zone. Prospecting work located
numerous zones of anomalous gold mine ralization in bedrock north and south of the Mac area
along with a well-developed soil anomaly located 800 meters north of the Santoy mine workings
that are expected to be targets for the 2020 drill campaign.