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Item 1. Financial Statements

2020-10-28 compared with 2020-07-29 · 182 added, 122 removed, 1095 unchanged (22% of the section changed)

3 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

June 30, 2020 December 31, 2019

September 30, 2020 December 31, 2019

ASSETS Notes In thousands, except share data

31 unchanged sentences

Common stock, par value $ 0.01 per share;

authorized 300,000,000 shares, 243,731,885 issued and outstanding at June 30, 2020 and 241,529,021 at December 31, 2019 2,437 2,415

authorized 300,000,000 shares, 243,744,601 issued and outstanding at September 30, 2020 and 241,529,021 at December 31, 2019

Additional paid-in capital 3,608,102 3,598,472

7 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2020 2019 2020 2019

10 unchanged sentences

OTHER INCOME (EXPENSE), NET

Loss on debt extinguishment 12 — ( 1,282 ) — ( 1,282 )

Fair value adjustments, net 12 2,243 4,377 3,491 8,201

8 unchanged sentences

OTHER COMPREHENSIVE INCOME (LOSS):

Change in fair value of derivative contracts designated as cash flow hedges ( 7,776 ) — ( 7,570 ) —

Change in fair value of derivative contracts designated as cash flow hedges, net of tax of $ 0 and $ 365 for the three and nine months ended September 30, 2020 and 2019 respectively.

( 18,606 ) 1,132 ( 26,176 ) 1,132

Unrealized gain (loss) on debt and equity securities — — — 59

16 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2020 2019 2020 2019

6 unchanged sentences

Deferred taxes ( 4,515 ) ( 10,545 ) ( 11,547 ) ( 27,962 )

Loss on debt extinguishment 12 — 1,282 — 1,282

Fair value adjustments, net 12 ( 2,243 ) ( 4,377 ) ( 3,491 ) ( 8,201 )

15 unchanged sentences

Proceeds from the sale of assets 18 730 26 5,245 930

Purchase of investments ( 2,500 ) — ( 2,500 ) —

Sale of investments — 1,007 19,802 2,109

40 unchanged sentences

Balances at June 30, 2020 243,732 $ 2,437 $ 3,605,982 $ ( 2,946,856 ) $ ( 7,706 ) $ 653,857

Net income (loss) — — — 26,856 — 26,856

Other comprehensive income (loss) — — — — ( 18,606 ) ( 18,606 )

Common stock issued/canceled under long-term incentive plans and director fees and options, net 13 — 2,120 — — 2,120

Balances at September 30, 2020 243,745 $ 2,437 $ 3,608,102 $ ( 2,920,000 ) $ ( 26,312 ) $ 664,227

In thousands Common

14 unchanged sentences

Balances at June 30, 2019 221,859 $ 2,219 $ 3,492,736 $ ( 2,648,509 ) $ — 846,446

Net income (loss) — — — ( 14,277 ) — ( 14,277 )

Other comprehensive income (loss) — — — — 1,132 1,132

Common stock issued for the extinguishment of Senior Notes 4,452 44 21,246 — — 21,290

Common stock issued under "at the market" stock offering 14,220 142 73,639 — — 73,781

Common stock issued under stock-based compensation plans, net ( 22 ) — 2,435 — — 2,435

Balances at September 30, 2019 240,509 $ 2,405 $ 3,590,056 $ ( 2,662,786 ) $ 1,132 930,807

The accompanying notes are an integral part of these Consolidated Financial Statements.

25 unchanged sentences

The following table presents a rollforward of the Franco-Nevada contract liability balance:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

In thousands 2020 2019 2020 2019

2 unchanged sentences

Closing Balance $ 9,996 $ 11,615 $ 9,996 $ 11,615

In June 2020, the Company received a $ 15.0 million prepayment for deliveries of gold concentrate from the Kensington mine pursuant to the Amended Sales Contract (as defined below).

In June 2020, the Company received a $ 15.0 million prepayment (the “June 2020 Prepayment” as defined in Note 17) for deliveries of gold concentrate from the Kensington mine pursuant to the Amended Sales Contract (as defined below).

The Amended Sales Contract represents a contract liability under ASC 606, which requires the Company to recognize ratably a portion of the deposit as revenue for each gold ounce delivered to the customer.

1 unchanged sentence

The following table presents a rollforward of the Amended Sales Contract liability balance:

Three Months Ended June 30, Six Months Ended June 30,

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

Three Months Ended September 30, Nine Months Ended September 30,

In thousands 2020 2019 2020 2019

3 unchanged sentences

Closing Balance $ 9,914 $ 10,592 $ 9,914 $ 10,592

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

Recently Adopted Accounting Standards

20 unchanged sentences

The 2019 novel strain of coronavirus causing a contagious respiratory disease known as COVID-19, which was declared a pandemic by the World Health Organization on March 11, 2020, poses a material risk to our business and operations.

Early in the second quarter of 2020, we temporarily suspended active mining and processing activities at the Palmarejo complex in the State of Chihuahua, Mexico, in accordance with a government-mandated decree in response to COVID-19, and we began taking steps to restart active mining, processing and exploration activities at Palmarejo in accordance with updated guidance from the government approximately 45 days later.

In addition, we are requiring all employees who travel to the Kensington mine to submit to a 7-day quarantine and testing protocol in Juneau, Alaska before traveling to the mine.

Early in the second quarter of 2020, we temporarily suspended active mining and processing activities at the Palmarejo complex in the State of Chihuahua, Mexico, in accordance with a government decree in response to COVID-19, and we began taking steps to restart active mining, processing and exploration activities at Palmarejo in accordance with updated guidance from the government approximately 45 days later.

In addition, as a result of several reported positive COVID-19 cases at our Kensington mine outside of Juneau, Alaska, during the third quarter of 2020 we experienced a minor short-term production impact associated with this situation, which has adversely impacted production and cash flows.

W e continue to require all employees who travel to the Kensington mine to submit to a 7-day quarantine and testing protocol in Juneau, Alaska before traveling to the mine.

We believe this is an important step to protect the health and safety of all workers who stay at the Kensington camp, although it has required changes to worker scheduling and is expected to result in higher labor costs due to additional overtime pay and pay during the quarantine period.

Incremental costs associated with the Company’s COVID-19 health and safety protocols are recorded in Pre-development, reclamation, and other expenses in our Condensed Consolidated Statement of Comprehensive Income (Loss) and are included in Other operating expenses in the table below.

For additional information, please see the section titled “Risk Factors” included in Item 1A.

Because of the highly uncertain and dynamic nature of events relating to the COVID-19 pandemic, it is not currently possible to estimate the impact of the pandemic on the Company’s operating segments.

However, these effects could have a material impact on our operations, and we will continue to monitor the COVID-19 situation closely.

Financial information relating to the Company’s segments is as follows (in thousands):

Three months ended June 30, 2020 Palmarejo Rochester Kensington Wharf Silvertip Other Total

Three months ended September 30, 2020 Palmarejo Rochester Kensington Wharf Silvertip Other Total

Gold sales $ 39,416 $ 12,860 $ 52,357 $ 62,499 $ — $ — $ 167,132

5 unchanged sentences

Costs applicable to sales (1)

34,251 19,104 31,530 27,887 — — 112,772

Amortization 11,912 3,278 11,523 4,000 1,185 318 32,216

2 unchanged sentences

Other income (expense)

Loss on debt extinguishment — — — — — — —

Fair value adjustments, net — — — — — 2,243 2,243

5 unchanged sentences

Segment assets (2)

$ 302,599 $ 325,165 $ 177,700 $ 76,247 $ 155,932 $ 170,208 $ 1,207,851

Capital expenditures $ 4,998 $ 9,773 $ 5,333 $ 545 $ 2,065 $ 282 $ 22,996

4 unchanged sentences

Notes to Condensed Consolidated Financial Statements

Three months ended June 30, 2019 Palmarejo Rochester Kensington Wharf Silvertip Other Total

Three months ended September 30, 2019 Palmarejo Rochester Kensington Wharf Silvertip Other Total

Gold sales $ 41,547 $ 11,290 $ 52,636 $ 36,398 $ — $ — $ 141,871

5 unchanged sentences

Costs applicable to sales (1)

37,397 27,749 29,533 22,084 24,189 — 140,952

Amortization 15,840 4,250 13,552 3,301 8,268 467 45,678

2 unchanged sentences

Other income (expense)

Loss on debt extinguishment — — — — — ( 1,282 ) ( 1,282 )

Fair value adjustments, net — — — — — 4,377 4,377

5 unchanged sentences

Segment assets (2)

342,274 283,229 204,926 99,600 417,678 172,735 1,520,442

Capital expenditures 7,818 10,248 4,944 759 6,359 550 30,678

1 unchanged sentence

(2) Segment assets include receivables, prepaids, inventories, property, plant and equipment, and mineral interests

Six months ended June 30, 2020 Palmarejo Rochester Kensington Wharf Silvertip Other Total

Nine months ended September 30, 2020 Palmarejo Rochester Kensington Wharf Silvertip Other Total

Gold sales $ 104,732 $ 30,508 $ 159,200 $ 128,199 $ — $ — $ 422,639

10 unchanged sentences

Other income (expense)

Loss on debt extinguishment — — — — — — —

Fair value adjustments, net — — — — — 3,491 3,491

12 unchanged sentences

Notes to Condensed Consolidated Financial Statements

Six months ended June 30, 2019 Palmarejo Rochester Kensington Wharf Silvertip Other Total

Nine months ended September 30, 2019 Palmarejo Rochester Kensington Wharf Silvertip Other Total

Gold sales $ 107,063 $ 33,538 $ 138,083 $ 80,277 $ — $ — $ 358,961

10 unchanged sentences

Other income (expense)

Loss on debt extinguishment — — — — — (1,282) (1,282)

Fair value adjustments, net — — — — — 8,201 8,201

9 unchanged sentences

(2) Segment assets include receivables, prepaids, inventories, property, plant and equipment, and mineral interests

Assets June 30, 2020 December 31, 2019

Assets September 30, 2020 December 31, 2019

Total assets for reportable segments $ 1,207,851 $ 1,215,783

3 unchanged sentences

Geographic Information

Long-Lived Assets June 30, 2020 December 31, 2019

Long-Lived Assets September 30, 2020 December 31, 2019

United States $ 489,614 $ 494,286

3 unchanged sentences

Total $ 934,859 $ 960,744

Revenue Three months ended June 30, Six months ended June 30,

Revenue Three months ended September 30, Nine months ended September 30,

2020 2019 2020 2019

8 unchanged sentences

Receivables consist of the following:

In thousands June 30, 2020 December 31, 2019

In thousands September 30, 2020 December 31, 2019

Current receivables:

13 unchanged sentences

See Note 17 -- Commitments and Contingencies for additional detail.

The $5.0 million decrease in the six months ended June 30, 2020 is attributable to a weaker Mexican Peso.

The $4.5 million decrease in the nine months ended September 30, 2020 is attributable to a weaker Mexican Peso.

(2) Represents receivable due from the successor to Republic Metals Corporation, whose bankruptcy filing in November 2018 impacted approximately 0.4 million ounces of Coeur’s silver and 6,500 ounces of Coeur’s gold.

2 unchanged sentences

Inventory consists of the following:

In thousands June 30, 2020 December 31, 2019

In thousands September 30, 2020 December 31, 2019

Concentrate $ 1,854 $ 6,557

6 unchanged sentences

159,746 137,731

Long-term stock pile $ 2,809 $ —

Long-term stockpile $ 3,691 $ —

Total inventory and ore on leach pads $ 210,415 $ 193,617

Prior to the temporary suspension of mining activities at Silvertip, Silvertip recognized inventory write-downs of $ 12.5 million in the six months ended June 30, 2020, which is recognized in Costs applicable to sales, as a result of lower than expected production levels, grades and recovery rates as well as reduced process plant availability.

Prior to the temporary suspension of mining activities at Silvertip, as a result of lower than expected production levels, grades and recovery rates as well as reduced process plant availability, Silvertip recognized inventory write-downs of $ 10.4 million, which are reflected in Costs applicable to sales for the nine months ended September 30, 2020.

Subsequent to the suspension of mining activities, Silvertip has recognized additional supply inventory write-downs of $ 3.3 million, which are reflected in Pre-development, reclamation, and other for the nine months ended September 30, 2020.

Coeur Mining, Inc.

4 unchanged sentences

The Company makes strategic investments in equity and debt securities of silver and gold exploration, development and royalty and streaming companies.

At June 30, 2020

At September 30, 2020

In thousands Cost Gross

27 unchanged sentences

Following the completion of both transactions, the Company held 909,756 Metalla Common Shares.

On September 14, 2020, the Company participated in an offering of shares of common stock of Integra Resources Corp.

(“Integra”) (“Integra Common Shares”), exercising a previously-acquired participation right, and purchased an additional 735,294 Integra Common Shares at a price of $ 3.40 per Integra Common Share for a total of $ 2.5 million.

Following completion of the transaction, Coeur owned approximately 5.6 % of issued and outstanding Integra Common Shares.

NOTE 7 – LEASES

1 unchanged sentence

The following table summarizes quantitative information pertaining to the Company’s finance and operating leases.

Three months ended June 30, Six months ended June 30,

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

Three months ended September 30, Nine months ended September 30,

In thousands 2020 2019 2020 2019

5 unchanged sentences

Total finance lease cost $ 5,036 $ 5,497 $ 19,358 $ 17,537

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

Supplemental cash flow information related to leases was as follows:

Three months ended June 30, Six months ended June 30,

Three months ended September 30, Nine months ended September 30,

In thousands 2020 2019 2020 2019

5 unchanged sentences

Supplemental balance sheet information related to leases was as follows:

In thousands June 30, 2020 December 31, 2019

In thousands September 30, 2020 December 31, 2019

Operating Leases

16 unchanged sentences

Weighted-average discount rate - operating leases 5.17 % 5.20 %

In the six months ended June 30, 2020, the Company entered into an agreement to modify one of its operating leases, significantly reducing the lease amount and lease term, thereby decreasing the operating lease liability at remeasurement.

In the quarter ended June 30, 2020, the Company entered into an agreement to modify one of its operating leases, significantly reducing the lease amount and lease term, thereby decreasing the operating lease liability at remeasurement.

The Company recognized a gain of $ 4.1 million in connection with this lease modification, which is recognized in Pre-development, reclamation, and other , together with the adjustment to the right of use asset and operating lease liability.

3 unchanged sentences

Notes to Condensed Consolidated Financial Statements

At June 30, (In thousands)

As of September 30, 2020 (In thousands)

Operating leases Finance leases

9 unchanged sentences

NOTE 8 – DEBT

June 30, 2020 December 31, 2019

September 30, 2020 December 31, 2019

In thousands Current Non-Current Current Non-Current

4 unchanged sentences

$ 23,265 $ 277,873 $ 22,746 $ 272,751

(1) Net of unamortized debt issuance costs of $ 2.8 million and $ 3.1 million at June 30, 2020 and December 31, 2019, respectively.

(2) Unamortized debt issuance costs of $ 1.9 million and $ 2.3 million at June 30, 2020 and December 31, 2019, respectively, included in Other Non-Current Assets .

(1) Net of unamortized debt issuance costs of $ 2.6 million and $ 3.1 million at September 30, 2020 and December 31, 2019, respectively.

(2) Unamortized debt issuance costs of $ 1.7 million and $ 2.3 million at September 30, 2020 and December 31, 2019, respectively, included in Other Non-Current Assets .

2024 Senior Notes

2 unchanged sentences

Revolving Credit Facility

At June 30, 2020, the Company had $ 60.0 million drawn on, and $ 20.5 million in letters of credit outstanding under, its $ 250.0 million revolving credit facility pursuant to the credit agreement originally entered into in September 2017 and subsequently amended among the Company, as borrower, and certain subsidiaries of the Company, as guarantors, and Bank of America, N.A., Royal Bank of Canada, Bank of Montreal, Chicago Branch, and the Bank of Nova Scotia as lenders (the “RCF”), leaving $ 169.5 million available under the RCF.

At June 30, 2020, the interest rate on the principal of the RCF was 2.7 %.

At September 30, 2020, the Company had $ 20.0 million drawn, and $ 20.5 million in letters of credit outstanding under, its $ 250.0 million revolving credit facility pursuant to the credit agreement originally entered into in September 2017 and subsequently amended among the Company, as borrower, and certain subsidiaries of the Company, as guarantors, and Bank of America, N.A., Royal Bank of Canada, Bank of Montreal, Chicago Branch, and the Bank of Nova Scotia as lenders (the “RCF”), leaving $ 209.5 million available under the RCF.

At September 30, 2020, the interest rate on the principal of the RCF was 2.7 %.

Finance Lease Obligations

From time-to-time, the Company acquires mining equipment and facilities under finance lease agreements.

In the six months ended June 30, 2020, the Company entered into new lease financing arrangements primarily for mining equipment at Kensington and Palmarejo.

In the nine months ended September 30, 2020, the Company entered into new lease financing arrangements primarily for mining equipment at Kensington and Palmarejo.

All capital lease obligations are recorded, upon lease inception, at the present value of future minimum lease payments.

4 unchanged sentences

Interest Expense

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

In thousands 2020 2019 2020 2019

12 unchanged sentences

Changes to the Company’s asset retirement obligations for its operating sites are as follows:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

In thousands 2020 2019 2020 2019

3 unchanged sentences

Asset retirement obligation - Ending $ 140,898 $ 139,736 $ 140,898 $ 139,736

The Company accrued $ 1.9 million at each of June 30, 2020 and December 31, 2019, respectively, for reclamation liabilities related to former mining activities, which are included in Reclamation.

The Company accrued $ 1.8 million and $ 1.9 million at each of September 30, 2020 and December 31, 2019, respectively, for reclamation liabilities related to former mining activities, which are included in Reclamation.

NOTE 10 - INCOME AND MINING TAXES

The following table summarizes the components of Income and mining tax (expense) benefit for the three and six months ended June 30, 2020 and 2019 by significant jurisdiction:

Three months ended June 30, Six months ended June 30,

The following table summarizes the components of Income and mining tax (expense) benefit for the three and nine months ended September 30, 2020 and 2019 by significant jurisdiction:

Three months ended September 30, Nine months ended September 30,

2020 2019 2020 2019

5 unchanged sentences

$ 39,969 $ ( 13,113 ) $ ( 14,059 ) $ ( 218 ) $ 25,765 $ ( 12,018 ) $ ( 89,921 ) $ 13,986

During the second quarter of 2020, the Company reported estimated income and mining tax expense of approximately $ 2.8 million, resulting in an effective tax rate of 173.9 %.

This compares to income tax benefit of $ 5.5 million for an effective tax rate of 13.1 % during the second quarter of 2019.

During the third quarter of 2020, the Company reported estimated income and mining tax expense of approximately $ 13.1 million, resulting in an effective tax rate of 32.8 %.

This compares to income tax expense of $ 0.2 million for an effective tax rate of 1.6 % during the third quarter of 2019.

The comparability of the Company’s income and mining tax (expense) benefit and effective tax rate for the reported periods was impacted by multiple factors, primarily:

(i) the non-recognition of tax assets;

(ii) foreign exchange rates;

(iii) the impact of uncertain tax positions;

(iv) variations in our income before income taxes;

(v) geographic distribution of that income and (vi) mining taxes.

(i) mining taxes;

(ii) variations in our income before income taxes;

(iii) geographic distribution of that income (iv) foreign exchange rates;

(v) the impact of uncertain tax positions;

and (vi) the non-recognition of tax assets.

Therefore, the effective tax rate will fluctuate, sometimes significantly, period to period.

A valuation allowance is provided for deferred tax assets for which it is more likely than not that the related tax benefits will not be realized.

The Company analyzes its deferred tax assets and, if it is determined that the Company will not realize all or a portion of its deferred tax assets, it will record or increase a valuation allowance.

Conversely, if it is determined

Coeur Mining, Inc.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements

A valuation allowance is provided for deferred tax assets for which it is more likely than not that the related tax benefits will not be realized.

The Company analyzes its deferred tax assets and, if it is determined that the Company will not realize all or a portion of its deferred tax assets, it will record or increase a valuation allowance.

Conversely, if it is determined that the Company ultimately will be more likely than not able to realize all or a portion of the related benefits for which a valuation allowance has been provided, all or a portion of the related valuation allowance will be reduced.

that the Company ultimately will be more likely than not able to realize all or a portion of the related benefits for which a valuation allowance has been provided, all or a portion of the related valuation allowance will be reduced.

There are a number of factors that impact the Company’s ability to realize its deferred tax assets.

5 unchanged sentences

As a result of statutes of limitation that will begin to expire within the next twelve months in various jurisdictions and possible settlements of audit-related issues with taxing authorities in various jurisdictions with respect to which none of the issues are individually significant, the Company believes that it is reasonably possible that the total amount of its net unrecognized income tax benefits will decrease between $ 0.5 million and $ 1.5 million in the next twelve months.

At June 30, 2020 and December 31, 2019, the Company had $ 0.6 million and $ 2.7 million of total gross unrecognized tax benefits from continuing operations, respectively, that, if recognized, would positively impact the Company’s effective income tax rate.

At September 30, 2020 and December 31, 2019, the Company had $ 0.6 million and $ 2.7 million of total gross unrecognized tax benefits from continuing operations, respectively, that, if recognized, would positively impact the Company’s effective income tax rate.

The Company’s continuing practice is to recognize potential interest and/or penalties related to unrecognized tax benefits as part of its income tax expense.

At June 30, 2020 and December 31, 2019, the amount of accrued income-tax-related interest and penalties was $ 1.0 million and $ 2.3 million, respectively.

At September 30, 2020 and December 31, 2019, the amount of accrued income-tax-related interest and penalties was $ 1.0 million and $ 2.3 million, respectively.

NOTE 11 – STOCK-BASED COMPENSATION

1 unchanged sentence

Stock awards include performance shares, restricted stock and stock options.

Stock-based compensation expense in the three and six months ended June 30, 2020 was $ 2.3 million and $ 4.3 million, respectively, compared to $ 2.0 million and $ 4.2 million for the three and six months ended June 30, 2019, respectively.

At June 30, 2020, there was $ 12.3 million of unrecognized stock-based compensation cost which is expected to be recognized over a weighted-average remaining vesting period of 1.8 years.

The following table summarizes the grants awarded during the six months ended June 30, 2020:

Stock-based compensation expense in the three and nine months ended September 30, 2020 was $ 2.0 million and $ 6.3 million, respectively, compared to $ 2.5 million and $ 6.7 million for the three and nine months ended September 30, 2019, respectively.

At September 30, 2020, there was $ 10.4 million of unrecognized stock-based compensation cost which is expected to be recognized over a weighted-average remaining vesting period of 1.7 years.

The following table summarizes the grants awarded during the nine months ended September 30, 2020:

Grant date Restricted

8 unchanged sentences

NOTE 12 – FAIR VALUE MEASUREMENTS

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

In thousands 2020 2019 2020 2019

10 unchanged sentences

Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement:

Fair Value at June 30, 2020

Fair Value at September 30, 2020

In thousands Total Level 1 Level 2 Level 3

Equity securities $ 19,862 $ 19,862 $ — $ —

Other derivative instruments, net 666 — 666 —

Foreign currency forward exchange contracts

7,614 — 7,614 —

Other derivative instruments, net $ — $ — $ — $ —

Provisional metal sales contracts 3 — 3 —

$ 27,479 $ 19,862 $ 7,617 $ —

Gold zero cost collars

$ 33,926 $ — $ 33,926 $ —

Provisional metal sales contracts 299 — 299 —

$ 34,225 $ — $ 34,225 $ —

Fair Value at December 31, 2019

1 unchanged sentence

Equity and debt securities $ 35,646 $ 35,646 $ — $ —

Other derivative instruments, net 753 — 753 —

Provisional metal sales contracts 753 — 753 —

$ 36,399 $ 35,646 $ 753 $ —

Silvertip contingent consideration $ 25,000 $ — $ — $ 25,000

Other derivative instruments, net 275 — 275 —

Provisional metal sales contracts 275 — 275 —

Gold zero cost collars

$ 25,411 $ — $ 411 $ 25,000

1 unchanged sentence

Such instruments are classified within Level 1 of the fair value hierarchy.

The Company’s other derivative instruments, net, include concentrate and certain doré sales contracts, gold and foreign exchange hedges, and an interest rate swap which are valued using pricing models with inputs derived from observable market data, including contractual terms, forward market prices, yield curves, credit spreads, and other unobservable inputs.

The Company’s foreign currency forward exchange contracts are valued using pricing models with inputs derived from observable market data, including forward market prices and other unobservable inputs.

The Company’s gold zero cost collars are valued using pricing models with inputs derived from observable market data, including forward market prices, yield curves, credit spreads, and other unobservable inputs.

The Company’s provisional metal sales contracts include concentrate and certain doré sales contracts that are valued using pricing models with inputs derived from observable market data, including forward market prices and other unobservable inputs.

The model inputs can generally be verified and do not involve significant management judgment.

4 unchanged sentences

During 2019, the Company paid the $25.0 million due for the permitting milestone in the form of cash and common stock, and in the first quarter of 2020, the Company paid the remaining $25.0 million due for the resource declaration milestone in the form of cash and common stock.

No assets or liabilities were transferred between fair value levels in the six months ended June 30, 2020.

The following tables present the changes in the fair value of the Company's Level 3 financial assets and liabilities in the six months ended June 30, 2020:

Six Months Ended June 30,

In thousands Balance at the beginning of the period Revaluation Settlements Accretion Balance at the

Silvertip contingent consideration $ 25,000 $ — $ ( 25,000 ) $ — $ —

The fair value of financial assets and liabilities carried at book value in the financial statements at June 30, 2020 and December 31, 2019 is presented in the following table:

No assets or liabilities were transferred between fair value levels in the nine months ended September 30, 2020.

Coeur Mining, Inc.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements

June 30, 2020

The following tables present the changes in the fair value of the Company's Level 3 financial assets and liabilities in the nine months ended September 30, 2020:

Nine Months Ended September 30,

In thousands Balance at the beginning of the period Revaluation Settlements Accretion Balance at the

Silvertip contingent consideration $ 25,000 $ — $ ( 25,000 ) $ — $ —

The fair value of financial assets and liabilities carried at book value in the financial statements at September 30, 2020 and December 31, 2019 is presented in the following table:

September 30, 2020

In thousands Book Value Fair Value Level 1 Level 2 Level 3

27 unchanged sentences

The embedded derivatives do not qualify for hedge accounting and are marked to market through earnings each period until final settlement.

At June 30, 2020, the Company had the following derivative instruments that settle as follows:

At September 30, 2020, the Company had the following derivative instruments that settle as follows:

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

In thousands except average prices and notional ounces 2020 Thereafter

3 unchanged sentences

The following summarizes the classification of the fair value of the derivative instruments:

June 30, 2020

September 30, 2020

In thousands Prepaid expenses and other Accrued liabilities and other

Provisional metal sales contracts $ 3 $ 299

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

December 31, 2019

1 unchanged sentence

Provisional metal sales contracts $ 753 $ 275

The following represent mark-to-market gains (losses) on derivative instruments in the three and six months ended June 30, 2020 and 2019, respectively (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

The following represent mark-to-market gains (losses) on derivative instruments in the three and nine months ended September 30, 2020 and 2019, respectively (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

Financial statement line Derivative 2020 2019 2020 2019

8 unchanged sentences

To protect the Company’s exposure to fluctuations in foreign currency exchange rates for subsidiaries whose functional currency is U.S dollar and are exposed to forecasted transaction denominated in the Mexican Peso and the Canadian Dollar, in March 2020, the Company entered into foreign currency forward exchange contracts to manage this risk and designated these instruments as cash flow hedges of forecasted foreign denominated transactions.

At June 30, 2020, the Company had the following derivative cash flow hedge instruments that settle as follows:

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

At September 30, 2020, the Company had the following derivative cash flow hedge instruments that settle as follows:

In thousands except average prices and notional ounces 2020 2021 and Thereafter

14 unchanged sentences

Deferred gains and losses associated with cash flow hedges of foreign currency transactions are recognized as a component of costs applicable to sales in the same period the related expenses are incurred.

As of June 30, 2020, the Company had $ 7.7 million of net after-tax loss in AOCI related to losses from cash flow hedge transactions, of which $ 4.1 million of net after-tax losses is expected to be recognized in its Condensed Consolidated Statement of Comprehensive Income (Loss) during the next 12 months.

As of September 30, 2020, the Company had $ 26.3 million of net after-tax loss in AOCI related to losses from cash flow hedge transactions, of which $ 13.8 million of net after-tax losses is expected to be recognized in its Condensed Consolidated Statement of Comprehensive Income (Loss) during the next 12 months.

Actual amounts ultimately reclassified to net income are dependent on the price of gold for metal contracts and the Canadian and Mexican exchange rates for foreign currency contracts.

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

The following summarizes the classification of the fair value of the derivative instruments designated as cash flow hedges:

June 30, 2020

September 30, 2020

In thousands Prepaid expenses and other Accrued liabilities and other

5 unchanged sentences

Gold zero cost collars $ — $ 136

The following table sets forth the pre-tax gains (losses) on derivatives designated as cash flow hedges that have been included in Accumulated Other Comprehensive Income (“AOCI”) and the Condensed Consolidated Statement of Comprehensive Income (Loss) for the three and six months ended June 30, 2020 and 2019, respectively (in thousands).

Three Months Ended June 30, Six Months Ended June 30,

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

The following table sets forth the pre-tax gains (losses) on derivatives designated as cash flow hedges that have been included in Accumulated Other Comprehensive Income (“AOCI”) and the Condensed Consolidated Statement of Comprehensive Income (Loss) for the three and nine months ended September 30, 2020 and 2019, respectively (in thousands).

Three Months Ended September 30, Nine Months Ended September 30,

2020 2019 2020 2019

7 unchanged sentences

$ 2,642 $ — $ 1,963 $ —

On August 10, 2020, in order to obtain more working capital flexibility, the Company novated certain of its gold zero cost collar option contracts to a different counterparty.

Other than a change in counterparty and the credit support provided under the agreements with the old and new counterparties, the novation did not result in any changes to the critical terms of the applicable option contracts, nor was there a change in creditworthiness in relation to the new counterparty.

To execute the novation, the Company was required to make an upfront payment of $3.8 million, as compensation for more favorable credit and margin requirements.

The credit risk exposure related to any derivative instrument is limited to the unrealized gains, if any, on outstanding contracts based on current market prices.

3 unchanged sentences

Other, net consists of the following:

Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

In thousands 2020 2019 2020 2019

1 unchanged sentence

Gain (loss) on sale of assets and investments ( 2,476 ) ( 100 ) ( 2,458 ) ( 120 )

Gold zero cost collars novation fee ( 3,819 ) — ( 3,819 ) —

Gain (loss) on sale of Manquiri NSR consideration (1)

4 unchanged sentences

(1) As defined in Note 18 -- Discontinued Operations.

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

NOTE 15 – NET INCOME (LOSS) PER SHARE

1 unchanged sentence

Diluted net income (loss) per share reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted into common stock.

For the three and six months ended June 30, 2020, there were 1,816,332 and 3,205,676 common stock equivalents, respectively, related to equity-based awards were not included in the diluted earnings per share calculation as the shares would be antidilutive.

Similarly, 3,241,533 common stock equivalents were excluded in the diluted earnings per share calculation for the three and six months ended June 30, 2019, respectively.

Three months ended June 30, Six months ended June 30,

For the three and nine months ended September 30, 2020, there were 182,803 and 1,722,014 common stock equivalents, respectively, related to equity-based awards were not included in the diluted earnings per share calculation as the

Coeur Mining, Inc.

and Subsidiaries

Notes to Condensed Consolidated Financial Statements

shares would be antidilutive.

Similarly, 319,162 and 1,312,737 common stock equivalents were excluded in the diluted earnings per share calculation for the three and nine months ended September 30, 2019, respectively.

Three months ended September 30, Nine months ended September 30,

In thousands except per share amounts 2020 2019 2020 2019

19 unchanged sentences

Sales under the ATM Program, if any, will be made pursuant to the terms of the Sales Agreement.

At June 30, 2020, the Company had not sold any of its common stock under the ATM Program.

At September 30, 2020, the Company had not sold any of its common stock under the ATM Program.

NOTE 16 - SUPPLEMENTAL GUARANTOR INFORMATION

10 unchanged sentences

CONDENSED CONSOLIDATING BALANCE SHEET

JUNE 30, 2020

SEPTEMBER 30, 2020

In thousands Coeur Mining, Inc.

87 unchanged sentences

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (LOSS)

THREE MONTHS ENDED JUNE 30, 2020

THREE MONTHS ENDED SEPTEMBER 30, 2020

In thousands Coeur Mining, Inc.

29 unchanged sentences

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (LOSS)

THREE MONTHS ENDED JUNE 30, 2019

THREE MONTHS ENDED SEPTEMBER 30, 2019

In thousands Coeur Mining, Inc.

10 unchanged sentences

OTHER INCOME (EXPENSE), NET

Loss on debt extinguishment ( 1,282 ) — — — ( 1,282 )

Fair value adjustments, net 4,378 ( 1 ) — — 4,377

6 unchanged sentences

Equity income (loss) in consolidated subsidiaries ( 11,371 ) ( 4 ) 95 11,280 —

Income (loss) from discontinued operations $ — $ — $ — $ — $ —

NET INCOME (LOSS) $ ( 14,273 ) $ 610 $ ( 11,894 ) $ 11,280 $ ( 14,277 )

OTHER COMPREHENSIVE INCOME (LOSS), net of tax:

Other comprehensive income (loss) — — — — —

Unrealized gain (loss) on hedges, net of tax of $363 for the three and nine months ended September 30, 2019 1,132 — — — 1,132

COMPREHENSIVE INCOME (LOSS) $ ( 13,141 ) $ 610 $ ( 11,894 ) $ 11,280 $ ( 13,145 )

3 unchanged sentences

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

THREE MONTHS ENDED JUNE 30, 2020

THREE MONTHS ENDED SEPTEMBER 30, 2020

In thousands Coeur Mining, Inc.

1 unchanged sentence

CASH FLOWS FROM OPERATING ACTIVITIES:

Cash provided by (used in) activities of operations ( 14,684 ) 38,128 ( 18,019 ) 4,522 9,947

Cash provided by (used in) activities of operations — — — — —

Cash provided by (used in) activities of continuing operations 30,905 48,535 41,440 ( 41,416 ) 79,464

Cash provided by (used in) activities of discontinued operations — — — — —

CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES 30,905 48,535 41,440 ( 41,416 ) 79,464

2 unchanged sentences

Proceeds from the sale of assets — 730 — — 730

Purchase of investments ( 2,500 ) — — — ( 2,500 )

Sales of investments — — — — —

Proceeds from notes receivable — — — — —

Other — — ( 25 ) — ( 25 )

1 unchanged sentence

Cash provided by (used in) activities of operations ( 43,984 ) ( 15,129 ) ( 7,094 ) 41,416 ( 24,791 )

Cash provided by (used in) activities of discontinued operations — — — — —

CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES ( 43,984 ) ( 15,129 ) ( 7,094 ) 41,416 ( 24,791 )

6 unchanged sentences

Cash provided by (used in) activities of operations 3,461 ( 42,977 ) ( 8,927 ) — ( 48,443 )

Cash provided by (used in) activities of discontinued operations — — — — —

CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 3,461 ( 42,977 ) ( 8,927 ) — ( 48,443 )

Effect of exchange rate changes on cash and cash equivalents — 6 ( 16 ) — ( 10 )

Less net cash provided by (used in) discontinued operations — — — — —

NET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH ( 9,618 ) ( 9,565 ) 25,403 — 6,220

5 unchanged sentences

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

THREE MONTHS ENDED JUNE 30, 2019

THREE MONTHS ENDED SEPTEMBER 30, 2019

In thousands Coeur Mining, Inc.

7 unchanged sentences

Proceeds from the sale of assets — 26 — — 26

Purchase of investments — — — — —

Sales of investments 1,007 — — — 1,007

7 unchanged sentences

Issuance of common stock 73,781 — — — 73,781

Issuance of notes and bank borrowings, net of issuance costs 30,000 — — — 30,000

Payments on debt, capital leases, and associated costs ( 83,034 ) ( 3,305 ) ( 1,439 ) — ( 87,778 )

13 unchanged sentences

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (LOSS)

SIX MONTHS ENDED JUNE 30, 2020

NINE MONTHS ENDED SEPTEMBER 30, 2020

In thousands Coeur Mining, Inc.

9 unchanged sentences

Total costs and expenses 28,701 301,513 184,357 — 514,571

OPERATING LOSS ( 18,756 ) 20,189 ( 7,994 ) — ( 6,561 )

OTHER INCOME (EXPENSE), NET

Loss on debt extinguishment — — — — —

Fair value adjustments, net 3,491 — — — 3,491

16 unchanged sentences

CONDENSED CONSOLIDATING STATEMENT OF COMPREHENSIVE INCOME (LOSS)

SIX MONTHS ENDED JUNE 30, 2019

NINE MONTHS ENDED SEPTEMBER 30, 2019

In thousands Coeur Mining, Inc.

10 unchanged sentences

OTHER INCOME (EXPENSE), NET

Loss on debt extinguishment ( 1,282 ) — — — ( 1,282 )

Fair value adjustments, net 8,210 ( 9 ) — — 8,201

10 unchanged sentences

Unrealized gain (loss) on debt securities, net of tax 59 — — — 59

Unrealized gain (loss) on hedges, net of tax of $363 for the three and nine months ended September 30, 2019 1,132 — — — 1,132

Other comprehensive income (loss) 1,191 — — — 1,191

4 unchanged sentences

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

SIX MONTHS ENDED JUNE 30, 2020

NINE MONTHS ENDED SEPTEMBER 30, 2020

In thousands Coeur Mining, Inc.

7 unchanged sentences

Proceeds from the sale of assets 4,500 745 — — 5,245

Purchase of investments ( 2,500 ) — — — ( 2,500 )

Sales of investments 19,802 — — — 19,802

Proceeds from notes receivable — — — — —

Other — — ( 225 ) — ( 225 )

1 unchanged sentence

Cash provided by (used in) activities of continuing operations ( 21,457 ) ( 35,687 ) ( 25,234 ) 42,814 ( 39,564 )

Cash provided by (used in) activities of discontinued operations — — — — —

CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES ( 21,457 ) ( 35,687 ) ( 25,234 ) 42,814 ( 39,564 )

6 unchanged sentences

Cash provided by (used in) activities of operations 19,413 ( 68,097 ) 28,045 — ( 20,639 )

Cash provided by (used in) activities of discontinued operations — — — — —

CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 19,413 ( 68,097 ) 28,045 — ( 20,639 )

Effect of exchange rate changes on cash and cash equivalents 3 ( 29 ) 319 — 293

Less net cash provided by (used in) discontinued operations — — — — —

NET CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH 10,723 ( 14,919 ) 25,706 — 21,510

5 unchanged sentences

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

SIX MONTHS ENDED JUNE 30, 2019

NINE MONTHS ENDED SEPTEMBER 30, 2019

In thousands Coeur Mining, Inc.

38 unchanged sentences

In accordance with generally accepted accounting principles, although Coeur Mexicana has satisfied its contractual obligation to repay the deposit to Franco-Nevada, the deposit is accounted for as deferred revenue and is recognized as revenue on a units of production basis as ounces are sold to Franco-Nevada.

At June 30, 2020 the remaining unamortized balance was $ 10.4 million, which is included in Accrued liabilities and other and Other long-term liabilities on the Consolidated Balance Sheet.

At September 30, 2020 the remaining unamortized balance was $ 10.0 million, which is included in Accrued liabilities and other and Other long-term liabilities on the Consolidated Balance Sheet.

Kensington Prepayment

3 unchanged sentences

The Amended Sales Contract was further amended in June 2020 to include options for Coeur to receive up to two additional prepayments of up to $ 15.0 million each for deliveries of gold concentrate from the Kensington mine, and Coeur exercised the option to receive the first $ 15.0 million prepayment in June 2020 (the “June 2020 Prepayment”).

In the third quarter of 2020, the Kensington mine delivered $ 5.2 million.

The remaining deliveries of $ 9.9 million under the June 2020 Prepayment are recognized as a deferred revenue liability and are presented in Accrued liabilities and other on the Consolidated Balance Sheet.

8 unchanged sentences

Mexico VAT Litigation

Included in non-current receivables as of June 30, 2020 are $ 23.0 million due from the Mexican government associated with VAT that was paid under Coeur Mexicana’s prior royalty agreement with a subsidiary of Franco-Nevada Corporation, which was terminated in 2016.

Included in non-current receivables as of September 30, 2020 are $ 23.5 million due from the Mexican government associated with VAT that was paid under Coeur Mexicana’s prior royalty agreement with a subsidiary of Franco-Nevada Corporation, which was terminated in 2016.

Under the royalty agreement, Coeur applied for and initially received VAT refunds associated with the royalty payments in the normal course;

1 unchanged sentence

Accordingly, Coeur began to request refunds of the VAT as undue payments, which the Mexican tax authorities also denied.

The Company has since been engaged in ongoing efforts to recover the VAT from the Mexican government (including through litigation).

The Company has since been engaged in ongoing efforts to recover the VAT from the Mexican government (including through litigation and potential arbitration).

Despite a favorable ruling from Mexican tax courts in this matter in 2018, litigation continues, some of which was determined unfavorably to the Company in 2019 and 2020 based on interpretations of applicable law and prior court decisions which the Company and its counsel believe are erroneous and which are now under appeal.

While the Company believes that it remains legally entitled to be refunded the full amount of the VAT receivable, the Company may continue to experience delays or obstacles in the recovery of VAT and it is possible that some or all of the VAT receivable may not ultimately be recovered as outcomes in Mexican tax courts and the process for recovering funds even if there is a successful outcome in litigation can be unpredictable.

Other Commitments and Contingencies

The continued failure to recover the VAT receivable may result in the Company recording a reserve against some or all of this amount, which, if material, may have a material adverse impact on the Company’s financial statements.

Coeur Mining, Inc.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements

environmental remediation, reclamation, collateral for gold hedges and other general corporate purposes.

As of June 30, 2020 and December 31, 2019, the Company had surety bonds totaling $ 212.1 million and $ 215.6 million, respectively, in place as financial support for future reclamation and closure costs.

Other Commitments and Contingencies

As part of its ongoing business and operations, the Company and its affiliates are required to provide surety bonds, bank letters of credit, bank guarantees and, in some cases, cash as financial support for various purposes, including environmental remediation, reclamation, collateral for gold hedges and other general corporate purposes.

As of September 30, 2020 and December 31, 2019, the Company had surety bonds totaling $ 212.8 million and $ 215.6 million, respectively, in place as financial support for future reclamation and closure costs.

The obligations associated with these instruments are generally related to performance requirements that the Company addresses through its ongoing operations and from time-to-time, the Company may be required to post collateral, including cash, to support these instruments.

16 unchanged sentences

Accrued liabilities and other consist of the following:

In thousands June 30, 2020 December 31, 2019

In thousands September 30, 2020 December 31, 2019

Accrued salaries and wages $ 23,202 $ 20,047

10 unchanged sentences

(1) See Note 17 -- Commitments and Contingencies for additional details on deferred revenue liabilities

T he following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the statement of financial position that total the same such amounts shown in the statement of cash flows in the three and six months ended June 30, 2020 and 2019:

Coeur Mining, Inc.

1 unchanged sentence

Notes to Condensed Consolidated Financial Statements

In thousands June 30, 2020 June 30, 2019

In thousands September 30, 2020 September 30, 2019

Cash and cash equivalents $ 77,148 $ 65,319

2 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements