What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2021-07-28 compared with 2021-04-28 · 250 added, 86 removed, 302 unchanged (53% of the section changed)

7 unchanged sentences

We are primarily a gold and silver producer with five mines located in the United States, Mexico and Canada and several exploration projects in North America.

First Quarter Highlights

Second Quarter Highlights

For the quarter, Coeur reported revenue of $214.9 million and cash flow from operating activities of $58.1 million.

We reported GAAP net income of $32.1 million, or $0.13 per diluted share.

On an adjusted basis 1 , the Company reported EBITDA of $52.7 million and net loss of $0.8 million, or $0.00 per diluted share.

For the six months ended June 30, 2021, Coeur reported revenue of $417.0 million and cash flow from operating activities of $53.7 million.

We reported GAAP net income of $34.2 million, or $0.14 per diluted share.

On an adjusted basis 1 , the Company reported EBITDA of $118.6 million and net income of $13.1 million or $0.05 per diluted share.

• Higher margins helped drive a stronger start to the year – Coeur’s first quarter results reflect a strong start to the year led by solid production and higher prices.

Notably, quarterly revenue, operating cash flow before changes in working capital 1 and adjusted EBITDA 1 increased 17%, 38% and 42% year-over-year, respectively

• Solid gold production and unit costs – The Company’s gold production of 85,225 ounces exceeded expectations for the quarter, tracking well towards its full-year guidance range.

Additionally, all of the Company’s site-level gold unit costs were either below or within their full-year guidance ranges

• Further enhanced liquidity and balance sheet – Coeur successfully refinanced its 5.875% senior notes due 2024 (“2024 Senior Notes”) with 5.125% senior notes due 2029 (“2029 Senior Notes”), capturing a lower interest rate, extending the maturity and opportunistically upsizing the offering.

The Company also extended the maturity of its senior secured revolving credit facility (“RCF”) from October 2022 to March 2025.

Together, these efforts improved Coeur’s liquidity profile and bolstered its balance sheet, helping to enhance financial flexibility ahead of a period of planned capital intensity

• Commenced major construction on Rochester expansion – The Company began major construction on the Plan of Operations Amendment 11 (“POA 11”) expansion at its Rochester mine.

Overall project progress was approximately 20% complete at the end of the first quarter.

Key elements of the project timeline remain on schedule and are expected to be largely completed by late next year

• Encouraging results from aggressive investment in exploration – Following its successful program in 2020, Coeur began the year with the largest exploration campaign in Company history.

The Company invested approximately $14.9 million ($9.7 million expensed and $5.2 million capitalized) in exploration during the quarter, drilling roughly 250,500 feet (76,375 meters) across all sites.

Drilling activities at Silvertip and Crown ramped up significantly during the quarter, while Coeur’s other sites continued to advance their resource expansion and infill programs

• Quarterly revenue and cash flow growth – Revenue increased 6% quarter-over-quarter and 39% year-over-year due to higher gold and silver ounces sold and a higher average realized silver price.

Operating cash flow improved by $62.4 million quarter-over-quarter and $48.1 million year-over-year to $58.1 million

• Higher quarterly production and stronger expected second half – Gold production increased 2% quarter-over-quarter to 87,275 ounces led by a 27% improvement at Wharf, while silver production of 2.6 million ounces was 8% higher largely due to a 15% increase at Rochester.

Year-over-year, gold and silver production increased 12% and 60%, respectively, driven by increases at Palmarejo and Rochester.

Production levels are expected to continue climbing in the second half of the year and be within the Company’s full-year guidance of 322,500 - 367,500 ounces of gold and 9.7 - 12.2 million ounces of silver

• New quarterly drilling record from largest exploration campaign in Company history – A new quarterly record was achieved during the period with the completion of approximately 320,400 feet (97,675 meters) of drilling and 27 currently active drill rigs.

Investment in exploration totaled approximately $18.6 million ($12.4 million expensed and $6.2 million capitalized) in the quarter with significant increases in drilling activity at Palmarejo and Rochester as well as the Crown district in southern Nevada

• Rochester expansion progressing according to schedule – Coeur advanced major construction on the Plan of Operations Amendment 11 (“POA 11”) expansion at Rochester on schedule, with solid ongoing environmental and safety performance.

Placement of over-liner material on the new Stage VI leach pad commenced approximately six weeks ahead of schedule, and concrete foundation work for the Merrill-Crowe process plant and crusher corridor is scheduled to begin in the third quarter.

Overall project progress was approximately 31% complete at the end of the second quarter

• Accelerating investment at Silvertip based on positive results – The Company is increasing its investment at Silvertip during the second half of 2021 to complete several surface projects to support a potential restart of active mining and processing activities in 2023

• Strategic investment in Victoria – Coeur acquired a 17.8% ownership interest in Victoria Gold Corp.

(“Victoria”) during the second quarter for consideration of approximately $118.8 million.

Victoria owns and operates the new open pit, heap leach Eagle gold mine located in central Yukon Territory, Canada.

The investment is consistent with the Company’s strategy and complements its existing portfolio of gold and silver assets located in high-quality jurisdictions

Selected Financial and Operating Results

Three Months Ended March 31,

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

In thousands 2021 2020 2021 2020

28 unchanged sentences

Average realized price per zinc pound, gross (3)

$ — $ — $ — NM

Average realized price per lead pound, gross (3)

$ — $ — $ — NM

(1) See “Non-GAAP Financial Performance Measures.”

3 unchanged sentences

Consolidated Financial Results

Three Months Ended March 31, 2021 compared to Three Months Ended March 31, 2020

Revenue increased by $29.0 million, or 17%, as a result of a 12% and 57% increase in average realized gold and silver prices, respectively, partially offset by lower gold and silver ounces sold (3% and 10%, respectively).

Three Months Ended June 30, 2021 compared to Three Months Ended June 30, 2020

Revenue increased by $60.6 million, or 39%, as a result of a 1% and 64% increase in average realized gold and silver prices, respectively and higher gold and silver ounces sold (14% and 59%, respectively).

In 2020, production was impacted by the temporary suspension of active mining operations at Palmarejo due to a government decree in response to COVID-19.

We sold 88,501 gold ounces and 2.6 million silver ounces, compared to 77,933 gold ounces and 1.6 million silver ounces in the prior year.

Gold and silver accounted for 68% and 32% of second quarter 2021 sales revenue, respectively.

This compares to gold and silver accounting for 83% and 17% of second quarter 2020 sales revenue, respectively.

The following table summarizes consolidated metal sales:

Three months ended June 30, Increase (Decrease) Percentage Change

In thousands 2021 2020

Gold sales $ 146,158 $ 127,902 $ 18,256 14 %

Silver sales 68,700 26,347 42,353 161 %

Metal sales $ 214,858 $ 154,249 $ 60,609 39 %

Costs Applicable to Sales

Costs applicable to sales increased $42.6 million, or 47%, primarily due to higher ounces sold resulting from the temporary suspension of active mining operations at Palmarejo in 2020 and a non-cash inventory charge of $8.6 million related to a change in the Company’s recovery rate assumption on the Stage IV leach pad, partially offset by the favorable impact of foreign currency hedges.

For a complete discussion of costs applicable to sales, see Results of Operations below.

Amortization increased $4.1 million, or 15%, primarily due higher ounces sold resulting from the temporary suspension of active mining operations at Palmarejo in 2020.

General and administrative expenses increased $1.9 million, or 21%, primarily due to higher employee incentive compensation costs.

Exploration expense increased $0.6 million, or 5%, attributable to ramp up of drilling activity at Palmarejo and Crown as well as the continuation of expansion and infill programs across the rest of the Company’s portfolio.

The Company completed 184,700 feet (56,300 meters) of expansion drilling and 135,900 feet (41,375 meters) of infill drilling in the second quarter of 2021 compared 160,680 feet (48,976 meters) of expansion drilling and 33,363 feet (10,169 meters) of infill drilling in the second quarter of 2020.

Pre-development, reclamation, and other expenses decreased $5.9 million, or 32%, stemming from lower costs incurred in connection with the Company’s COVID-19 health and safety protocols and one-time costs at Silvertip including a $2.1 million write down of obsolete supply inventory in 2020.

The following table summarizes pre-development, reclamation, and other expenses:

Three months ended June 30, Increase (Decrease) Percentage Change

In thousands 2021 2020

COVID-19 $ 2,315 $ 6,108 $ (3,793) (62) %

Silvertip ongoing carrying costs 6,447 5,183 1,264 24 %

Silvertip temporary suspension costs — 3,829 (3,829) (100) %

Asset retirement accretion 2,965 2,908 57 2 %

Other 1,011 647 364 56 %

Pre-development, reclamation and other expense $ 12,738 $ 18,675 $ (5,937) (32) %

Other Income and Expenses

Fair value adjustments, net, increased to a gain of $37.2 million compared to $10.1 million, as a result of favorable changes in value related to the Company’s recent investment in Victoria.

The estimated fair values of the Company’s equity investments in Victoria and Integra were $164.7 million and $9.6 million, respectively, at June 30, 2021.

Interest expense (net of capitalized interest of $1.8 million) decreased to $5.1 million from $5.8 million due to higher capitalized interest associated with the POA 11 project at Rochester, and lower interest paid under the RCF, partially offset by higher interest paid under the 2029 Senior Notes compared to the 2024 Senior Notes.

Other, net increased to a gain of $0.7 million compared to $0.1 million due to an increase in gains on the sale of assets.

Income and Mining Taxes

During the second quarter of 2021, income and mining tax expense of approximately $15.3 million resulted in an effective tax rate of 32.3% for 2021.

This compares to income tax expense of $2.8 million or effective tax rate of 173.9% for 2020.

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) mining taxes;

(ii) variations in our income before income taxes;

(iii) geographic distribution of that income;

(iv) foreign exchange rates;

(v) percentage depletion;

(vi) the non-recognition of tax assets;

and (vii) the impact of uncertain tax positions.

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

The following table summarizes the components of the Company’s income (loss) before tax and income and mining tax (expense) benefit:

Three months ended June 30, 2021

In thousands Income (loss) before tax Tax (expense) benefit Income (loss) before tax Tax (expense) benefit

United States $ 29,647 $ (7,228) $ 12,546 $ 827

Canada (12,979) — (15,621) 217

Mexico 30,827 (8,112) 4,805 (3,888)

Other jurisdictions (9) — (95) —

$ 47,486 $ (15,340) $ 1,635 $ (2,844)

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 will ultimately 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.

For additional information, please see “Item 1A - Risk Factors” in the 2020 10-K.

Net Income (Loss)

Net income was $32.1 million, or $0.13 per diluted share, compared to net loss of $1.2 million, or $0.01 per share.

The increase in net income was driven a 1% and 64% increase in average realized gold and silver prices, respectively, higher gold and silver ounces sold (14% and 59%, respectively), favorable changes in value related to the Company’s recent investment in Victoria and lower costs incurred in connection with the Company’s COVID-19 health and safety protocols.

Also, in 2020, production was impacted by the temporary suspension of active mining operations at Palmarejo.

This was partially offset by higher exploration and income and mining tax expense.

Adjusted net loss was $0.8 million, or $0.00 per diluted share, compared to adjusted net income of $2.6 million, or $0.01 per share (see “Non-GAAP Financial Performance Measures”).

Six Months Ended June 30, 2021 compared to Six Months Ended June 30, 2020

Revenue increased by $89.6 million, or 27%, as a result of a 6% and 60% increase in average realized gold and silver prices, respectively, and higher gold and silver ounces sold (5% and 16%, respectively).

In 2020, production was impacted by the temporary suspension of active mining operations at Palmarejo due to a government decree in response to COVID-19.

We sold 171,613 gold ounces and 5.0 million silver ounces, compared to 163,568 gold ounces, 4.3 million silver ounces, 3.2 million zinc pounds and 2.5 million lead pounds in the prior year.

2 unchanged sentences

The following table summarizes consolidated metal sales:

Three months ended March 31, Increase (Decrease) Percentage Change

Six months ended June 30, Increase (Decrease) Percentage Change

In thousands 2021 2020

5 unchanged sentences

Costs Applicable to Sales

Costs applicable to sales decreased $10.8 million, or 9%, primarily due to the temporary suspension at Silvertip, lower ounces sold at Palmarejo and the favorable impact from foreign currency hedges.

Costs applicable to sales increased $31.8 million, or 15%, primarily due to higher ounces sold resulting from the 2020 temporary suspension of active mining operations at Palmarejo and Silvertip and a non-cash inventory charge of $8.6 million related to a change in the Company’s recovery rate assumption on the Stage IV leach pad, partially offset by the favorable impact from foreign currency hedges.

For a complete discussion of costs applicable to sales, see Results of Operations below.

Amortization decreased $6.2 million, or 17%, primarily due to the temporary suspension at Silvertip, longer assumed mine life based on year-end 2020 mineral reserve growth at Palmarejo and lower ounces sold at Palmarejo.

Amortization decreased $2.1 million, or 3%, primarily due to the 2020 temporary suspension of active mining operations at Palmarejo and Silvertip and longer assumed mine life based on year-end 2020 mineral reserve growth at Palmarejo, partially offset by higher ounces sold.

General and administrative expenses increased $4.5 million, or 26%, primarily due to higher employee incentive compensation costs.

Exploration expense increased $3.9 million, or 21%, as the Company maintained its commitment to a higher-level of exploration investment following the completion of the largest and most successful drilling campaign in Coeur’s history during 2020.

The Company completed 122,300 feet (37,275 meters) of expansion drilling and 128,200 feet (39,100 meters) of infill drilling in the first quarter of 2021 compared 119,471 feet (36,415 meters) of expansion drilling and 50,209 feet (15,304 meters) of infill drilling in the first quarter of 2020.

Pre-development, reclamation, and other expenses increased $7.2 million, or 109%, stemming from full-quarter ongoing carrying and temporary suspension costs at Silvertip and incremental costs incurred in connection with the Company’s COVID-19 health and safety protocols, and a gain resulting from the modification of a right of use lease at Silvertip in 2020.

The Company completed 313,300 feet (95,525 meters) of expansion drilling and 263,700 feet (80,350 meters) of infill drilling in the first half of 2021 compared 280,151 feet (85,391 meters) of expansion drilling and 83,572 feet (25,473 meters) of infill drilling in the first half of 2020.

Pre-development, reclamation, and other expenses increased $1.2 million, or 5%, stemming from full-year ongoing carrying costs at Silvertip, partially offset by a gain resulting from the modification of a right of use lease at Silvertip in 2020, lower costs incurred in connection with the Company’s COVID-19 health and safety protocols and one-time costs at Silvertip including a $2.1 million write down of obsolete supply inventory in 2020.

The following table summarizes pre-development, reclamation, and other expenses:

Three months ended March 31, Increase (Decrease) Percentage Change

Six months ended June 30, Increase (Decrease) Percentage Change

In thousands 2021 2020

7 unchanged sentences

Other Income and Expenses

During the first quarter of 2021, the Company incurred a $9.2 million loss in connection with the tender and redemption of the 2024 Senior Notes concurrent with the completed offering of the 2029 Senior Notes.

Fair value adjustments, net, decreased to a loss of $3.8 million compared to loss of $8.8 million in the prior year quarter, a result of unfavorable changes in value related to the Company’s prior equity investment in Metalla Royalty & Streaming Ltd.

Interest expense (net of capitalized interest of $0.8 million) decreased to $4.9 million from $5.1 million due to higher capitalized interest associated with the POA 11 project at Rochester, partially offset by higher interest paid under the 2029 Senior Notes compared to the 2024 Senior Notes.

During the first half of 2021, the Company incurred a $9.2 million loss in connection with the tender and redemption of the 2024 Senior Notes concurrent with the completed offering of the 2029 Senior Notes.

Fair value adjustments, net, increased to a gain of $33.4 million compared to $1.2 million as a result of favorable changes in value related to the Company’s recent investment in Victoria.

The estimated fair values of the Company’s equity investments in Victoria and Integra were $164.7 million and $9.6 million, respectively, at June 30, 2021.

Interest expense (net of capitalized interest of $2.6 million) decreased to $10.0 million from $10.9 million due to higher capitalized interest associated with the POA 11 project at Rochester, and lower interest paid under the RCF, partially offset by higher interest paid under the 2029 Senior Notes compared to the 2024 Senior Notes.

Other, net increased to a gain of $4.3 million compared to $2.0 million due to an increase in gains on the sale of assets.

Income and Mining Taxes

During the first quarter of 2021, income and mining tax expense of approximately $12.8 million resulted in an effective tax rate of 86.1% for 2021.

During the first half of 2021, income and mining tax expense of approximately $28.1 million resulted in an effective tax rate of 45.1% for 2021.

This compares to income tax benefit of $1.1 million or effective tax rate of 7.7% for 2020.

9 unchanged sentences

The following table summarizes the components of the Company’s income (loss) before tax and income and mining tax (expense) benefit:

Three months ended March 31,

Six months ended June 30,

In thousands Income (loss) before tax Tax (expense) benefit Income (loss) before tax Tax (expense) benefit

11 unchanged sentences

Net income was $34.2 million, or $0.14 per diluted share, compared to net loss of $13.1 million, or $0.05 per share.

The increase in net income was driven by strong operating results at Wharf, a 12% and 57% increase in average realized gold and silver prices, respectively, and lower operating costs at Silvertip.

This was partially offset by lower sales of gold and silver (3% and 10%, respectively), higher exploration expense, a $9.2 million loss on debt extinguishment, a full-quarter of ongoing carrying and severance costs at Silvertip and incremental costs associated with the Company’s COVID-19 health and safety protocols.

Adjusted net income was $13.9 million, or $0.06 per diluted share, compared to adjusted net loss of $0.9 million, or $0.00 per share (see “Non-GAAP Financial Performance Measures”).

The increase in net income was driven by a 6% and 60% increase in average realized gold and silver prices, respectively, higher sales of gold and silver (5% and 16%, respectively), favorable changes in value related to the Company’s recent investment in Victoria, and lower operating costs at Silvertip.

This was partially offset by higher exploration expense, a $9.2 million loss on debt extinguishment, severance costs and a full-year of ongoing carrying costs at Silvertip and higher income and mining taxes.

Adjusted net income was $13.1 million, or $0.05 per diluted share, compared to $1.7 million, or $0.01 per share (see “Non-GAAP Financial Performance Measures”).

Results of Operations

Three Months Ended March 31,

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

2021 2020 2021 2020

Tons milled 517,373 269,641 1,001,763 749,203

8 unchanged sentences

Costs applicable to sales per gold ounce (1)

$ 659 $ 690 $ 648 $ 659

Costs applicable to sales per silver ounce (1)

1 unchanged sentence

(1) See Non-GAAP Financial Performance Measures.

Three Months Ended March 31, 2021 compared to Three Months Ended March 31, 2020

Gold and silver production decreased 9% and 13%, respectively, as a result of lower gold and silver grades, as expected, partially offset by higher mill throughput and higher gold recovery.

Three Months Ended June 30, 2021 compared to Three Months Ended June 30, 2020

Gold and silver production increased 81% and 92%, respectively, as a result of the temporary suspension of active mining operations at Palmarejo in 2020 due to a government decree in response to COVID-19.

Metal sales were $85.0 million, or 40% of Coeur’s metal sales, compared with $38.0 million, or 25% of Coeur’s metal sales.

Revenue for the three months ended March 31, 2021 increased by $6.0 million or 8%, of which $21.0 million was the result of higher average realized gold and silver prices, partially offset by a decrease of $15.0 million due to lower volume of gold and silver sales.

Costs applicable to sales per gold ounce decreased 3% while costs applicable to sales per silver ounce increased 32% due to the mix of gold and silver sales, lower production and higher maintenance costs partially offset by the favorable impact from foreign currency hedges.

Amortization decreased to $9.1 million due to a longer mine life based on year-end 2020 reserve growth and lower ounces sold.

Capital expenditures increased to $10.0 million from $7.1 million attributable to higher underground development at the La Nacion deposit.

Three Months Ended March 31,

Revenue for the three months ended June 30, 2021 increased by $47.1 million or 124%, of which $38.8 million was the result of a higher volume of gold and silver sales and $8.3 million due to higher average realized gold and silver prices.

Costs applicable to sales per gold ounce decreased 4% while costs applicable to sales per silver ounce increased 62% due to the mix of gold and silver sales, lower gold and silver grades, and higher consumable and maintenance costs, partially offset by the favorable impact of foreign currency hedges.

Amortization increased to $8.3 million due to higher ounces sold.

Capital expenditures increased to $9.8 million from $4.5 million due to the impact of the 2020 temporary suspension on underground development and infill drilling activities.

Six Months Ended June 30, 2021 compared to Six Months Ended June 30, 2020

Gold and silver production increased 20% and 21%, respectively, as a result of the temporary suspension of active mining operations at Palmarejo in 2020 and higher recoveries, partially offset by lower gold and silver grades.

Metal sales were $165.4 million, or 40% of Coeur’s metal sales, compared with $112.3 million, or 34% of Coeur’s metal sales.

Revenue for the six months ended June 30, 2021 increased by $53.1 million or 47%, of which $28.5 million was the result of higher average realized gold and silver prices, and $24.6 million was due to a higher volume of gold and silver sales.

Costs applicable to sales per gold ounce decreased 2% while costs applicable to sales per silver ounce increased 45% due to the mix of gold and silver sales, lower gold and silver grades, and higher consumable and maintenance costs, partially offset by the favorable impact from foreign currency hedges.

Amortization decreased to $17.3 million due to a longer anticipated mine life based on year-end 2020 reserve growth, partially offset by higher ounces sold.

Capital expenditures increased to $19.8 million from $11.6 million attributable to higher underground development at the La Nacion deposit and the impact of the 2020 temporary suspension on underground development and infill drilling activities.

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

2021 2020 2021 2020

Tons placed 3,195,777 3,743,331 6,436,694 7,171,909

10 unchanged sentences

(1) See Non-GAAP Financial Performance Measures.

Three Months Ended March 31, 2021 compared to Three Months Ended March 31, 2020

Three Months Ended June 30, 2021 compared to Three Months Ended June 30, 2020

Gold and silver production increased 40% and 22%, respectively, due to the timing of recoveries, higher gold grade and the restocking of leach pad inventory after the commissioning of the high-pressure grinding roll in 2019, which adversely impacted 2020 gold and silver production.

Metal sales were $38.1 million, or 18% of Coeur’s metal sales, compared with $20.6 million, or 13% of Coeur’s metal sales.

Revenue for the three months ended March 31, 2021 increased by $13.4 million or 69%, of which $7.1 million was the result of higher average realized gold and silver prices, and $6.3 million due to higher volume of gold and silver sales.

Costs applicable to sales per gold ounce decreased 6% while costs applicable to sales per silver

ounce increased 31% due to the mix of gold and silver sales as well as higher equipment maintenance costs.

Revenue for the three months ended June 30, 2021 increased by $17.4 million or 84%, of which $9.4 million was the result of a higher volume of gold and silver sales and $8.0 million was due to higher average realized gold and silver prices.

Costs applicable to sales per gold and silver ounce increased 18% and 85%, respectively, due to the mix of gold and silver sales, higher consumable costs and a non-cash inventory charge of $8.6 million related to a change in the Company’s recovery rate assumption on the Stage IV leach pad.

Amortization increased to $6.5 million due to higher ounces sold.

Capital expenditures increased to $42.3 million from $5.8 million due to the commencement of construction activities related to POA 11 in August 2020.

Three Months Ended March 31,

Six Months Ended June 30, 2021 compared to Six Months Ended June 30, 2020

Gold and silver production increased 27% and 17%, respectively, due to the timing of recoveries, higher gold grade and the restocking of leach pad inventory after the commissioning of the high-pressure grinding roll in 2019, which adversely impacted 2020 gold and silver production.

Metal sales were $70.8 million, or 17% of Coeur’s metal sales, compared with $40.0 million, or 12% of Coeur’s metal sales.

Revenue for the six months ended June 30, 2021 increased by $30.8 million or 77%, of which $15.8 million was the result of a higher volume of gold and silver sales and $15.0 million was the result of higher average realized gold and silver prices.

Costs applicable to sales per gold and silver ounce increased 8% and 59%, respectively, due to the mix of gold and silver sales, higher consumable and equipment maintenance costs, and a non-cash inventory charge of $8.6 million related to a change in the Company’s recovery rate assumption on the Stage IV leach pad.

Amortization increased to $10.1 million due to higher ounces sold.

Capital expenditures increased to $72.4 million from $10.9 million due to the commencement of construction activities related to POA 11 in August 2020.

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

2021 2020 2021 2020

Tons milled 168,311 170,478 338,669 332,819

4 unchanged sentences

Costs applicable to sales per gold ounce (1)

$ 1,090 $ 939 $ 1,038 $ 935

(1) See Non-GAAP Financial Performance Measures.

Three Months Ended March 31, 2021 compared to Three Months Ended March 31, 2020

Three Months Ended June 30, 2021 compared to Three Months Ended June 30, 2020

Gold production decreased 14% as a result of lower grade and mill throughput.

Metal sales were $48.8 million, or 23% of Coeur’s metal sales, compared to $55.2 million, or 36% of Coeur’s metal sales.

Revenue for the three months ended June 30, 2021 decreased by $6.4 million or 12%, of which $10.1 million resulted from a lower volume of gold sales, partially offset by an increase of $3.7 million due to higher average realized gold prices.

Costs applicable to sales per gold ounce increased 16% due to lower production and higher diesel and outside service costs.

Amortization decreased slightly to $12.7 million due to lower ounces sold partially offset by higher Jualin production.

Capital expenditures increased to $6.0 million from $3.9 million due to higher infill drilling and underground development.

Six Months Ended June 30, 2021 compared to Six Months Ended June 30, 2020

Gold production decreased 9% as a result of lower grade, partially offset by higher mill throughput.

Metal sales were $103.3 million, or 25% of Coeur’s metal sales, compared to $106.8 million, or 33% of Coeur’s metal sales.

Revenue for the three months ended March 31, 2021 increased by $2.8 million or 5%, of which $4.9 million resulted from higher average realized gold prices, partially offset by a decrease of $2.1 million due to lower volume of gold sales.

Costs applicable to sales per gold ounce increased 7% due to lower production and higher equipment rental, outside service and maintenance costs.

Amortization increased to $13.4 million primarily due to higher Jualin production.

Capital expenditures increased to $7.2 million from $4.8 million due to higher infill drilling.

Three Months Ended March 31,

Revenue for the six months ended June 30, 2021 decreased by $3.6 million or 3%, of which $12.0 million resulted from lower volume of gold sales, partially offset by an increase of $8.4 million due to higher average realized gold prices.

Costs applicable to sales per gold ounce increased 11% due to lower production and higher diesel, outside service and maintenance costs.

Amortization increased to $26.2 million primarily due to higher Jualin production, partially offset by lower ounces sold.

Capital expenditures increased to $13.2 million from $8.7 million due to higher infill drilling and underground development.

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

2021 2020 2021 2020

Tons placed 1,025,481 1,401,237 2,139,524 2,347,686

7 unchanged sentences

(1) See Non-GAAP Financial Performance Measures.

Three Months Ended March 31, 2021 compared to Three Months Ended March 31, 2020

Gold production increased 22% driven by higher grade, higher placed tons and favorable weather conditions.

Three Months Ended June 30, 2021 compared to Three Months Ended June 30, 2020

Gold production decreased 3% driven by lower placed tons.

Metal sales were $42.9 million, or 20% of Coeur’s metal sales, compared to $40.5 million, or 26% of Coeur’s metal sales.

Revenue for the three months ended March 31, 2021 increased by $8.7 million or 34%, of which $5.3 million resulted from a higher volume of gold and silver sales and $3.4 million due to higher average realized gold and silver prices.

Costs applicable to sales per gold ounce decreased 13% due to higher production and lower diesel and cyanide costs.

Amortization remained comparable at $2.5 million due to a lower units-of-production depletion rate.

Revenue for the three months ended June 30, 2021 increased by $2.5 million or 6%, of which $2.2 million resulted from higher average realized gold and silver prices and $0.3 million was due to a higher volume of gold and silver sales.

Costs applicable to sales per gold ounce slightly increased 2% due to higher employee-related costs, partially offset by a $3.3 million inventory write-down related to lower expected recoveries from leach pads 4 and 5 in 2020.

Amortization decreased slightly to $3.0 million due to a lower units-of-production depletion rate.

Capital expenditures were $1.4 million.

Three Months Ended March 31,

Six Months Ended June 30, 2021 compared to Six Months Ended June 30, 2020

Gold production increased 7% driven by higher grade and favorable weather conditions.

Metal sales were $77.5 million, or 19% of Coeur’s metal sales, compared to $66.3 million, or 20% of Coeur’s metal sales.

Revenue for the six months ended June 30, 2021 increased by $11.1 million or 17%, of which $5.6 million resulted from higher average realized gold and silver prices and $5.5 million was due to a higher volume of gold and silver sales.

Costs applicable to sales per gold ounce decreased 4% due to higher production and a $3.3 million inventory write-down related to lower expected recoveries from leach pads 4 and 5 in 2020, partially offset by higher equipment rental and employee-related costs.

Amortization remained decreased slightly to $5.5 million due to a lower units-of-production depletion rate.

Capital expenditures were $2.9 million.

Three and Six Months Ended June 30,

2021 2020 2021 2020

Silver ounces produced — — — 139,287

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Costs applicable to sales per silver ounce (2)

$ — $ — $ — NM (1)

Costs applicable to sales per zinc pound (2)

$ — $ — $ — NM (1)

Costs applicable to sales per lead ounce (2)

$ — $ — $ — NM (1)

(1) Due to the temporary suspension of mining and processing activities these amounts are not meaningful.

(2) See Non-GAAP Financial Performance Measures.

Three Months Ended March 31, 2021 compared to Three Months Ended March 31, 2020

Three and Six Months Ended June 30, 2021 compared to Three and Six Months Ended June 30, 2020

Silvertip temporarily suspended mining and processing activities, unrelated to COVID-19, in February 2020.

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Ongoing carrying and temporary suspension costs are included in Pre-development, reclamation, and other.

Coeur continued advancing Silvertip’s revised 1,750 tonnes per day flowsheet through a more comprehensive engineering and design phase, with detailed design approaching 30% completion and exploration results demonstrating the potential for mine life extensions with continued drilling.

The Company plans to release an updated mine plan and economic analysis for Silvertip at the end of the year, including additional exploration results, updated engineering and revised capital estimate as well as information regarding the anticipated benefits of the 1,750 tonnes per day flowsheet which will be reflected in a technical report that is expected to be filed in early 2022.

In June 2021, Silvertip repurchased from Silvertip Resources Investment Cayman Ltd.

for $7.0 million a net smelter returns royalty of 1.429% on the first 1,434,000 metric tonnes of mineralized material mined, and 1.00% thereafter.

Liquidity and Capital Resources

At March 31, 2021, the Company had $155.4 million of cash, cash equivalents and restricted cash and $265.0 million available under its RCF.

Cash and cash equivalents increased $61.3 million in the three months ended March 31, 2021, due to a 12% and 57% increase in average realized gold and silver prices, respectively, strong operational results from Wharf, net proceeds of $367.5 million from the issuance of the 2029 Senior Notes, partially offset by the tender and redemption of the 2024 Senior Notes for $238.3 million, including premiums, and $4.0 million of accrued and unpaid interest, lower ounces sold at Palmarejo and Kensington and ongoing carrying costs at Silvertip.

Since the start of the COVID-19 pandemic, the Company has completed various scenario planning analyses to consider potential impacts of COVID-19 on its business, including volatility in commodity prices, temporary disruptions and/or curtailments of operating activities (voluntary or involuntary).

At June 30, 2021, the Company had $125.5 million of cash, cash equivalents and restricted cash and $265.0 million available under its RCF.

Cash and cash equivalents increased $31.3 million in the six months ended June 30, 2021, due to a 6% and 60% increase in average realized gold and silver prices, respectively, higher gold and silver ounces sold (5% and 16%, respectively), net proceeds of $367.5 million from the issuance of the 2029 Senior Notes, partially offset by the tender and redemption of the 2024 Senior Notes for $238.3 million, including premiums, and ongoing carrying costs at Silvertip.

activities (voluntary or involuntary).

To provide additional flexibility to respond to potential downside scenarios, the Company has been able to periodically draw and make repayments under its RCF subsequent to the start of the COVID-19 pandemic.

At March 31, 2021, the Company had no borrowings and $35.0 million in outstanding letters of credit under the RCF, which was amended in March 2021 to allow the Company to obtain one or more increases of the RCF in an aggregate amount of up to $100.0 million and extend the maturity to March 2025.

At June 30, 2021, the Company had no borrowings and $35.0 million in outstanding letters of credit under the RCF, which was amended in March 2021 to allow the Company to obtain one or more increases of the RCF in an aggregate amount of up to $100.0 million and extend the maturity to March 2025.

Additionally, Coeur established a $100.0 million ATM Program in April 2020 as a means to proactively increase its financial flexibility in response to increased volatility and uncertainty associated with COVID-19.

At the date of this filing, the Company has yet to issue any shares of its common stock under the ATM Program and intends to maintain the program during the POA 11 construction.

Cash Used in Operating Activities

Net cash used in operating activities for the three months ended March 31, 2021 was $4.4 million, compared to $8.0 million for the three months ended March 31, 2020.

Adjusted EBITDA for the three months ended March 31, 2021 was $65.9

million, compared to $46.5 million for the three months ended March 31, 2020 (see “Non-GAAP Financial Performance Measures”).

Cash Provided by Operating Activities

Net cash provided by operating activities for the three months ended June 30, 2021 was $58.1 million, compared to $9.9 million for the three months ended June 30, 2020.

Net cash provided by operating activities for the six months ended June 30, 2021 was $53.7 million, compared to $2.0 million for the six months ended June 30, 2020.

Adjusted EBITDA for the three months ended June 30, 2021 was $52.7 million, compared to $42.2 million for the three months ended June 30, 2020.

Adjusted EBITDA for the six months ended June 30, 2021 was $118.6 million, compared to $88.6 million for the six months ended June 30, 2020 (see “Non-GAAP Financial Performance Measures”).

Net cash provided by operating activities was impacted by the following key factors for the applicable periods:

Three Months Ended March 31,

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

In thousands 2021 2020 2021 2020

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Cash provided by (used in) operating activities $ 58,059 $ 9,947 $ 53,700 $ 1,956

Net cash used in operating activities decreased $3.6 million for the three months ended March 31, 2021, primarily due to a 12% and 57% increase in average realized gold and silver prices, respectively, partially offset by lower ounces sold of gold and silver (3% and 10%, respectively), higher income and mining tax payments at Palmarejo and payment of $4.0 million of interest related to the tender and redemption of the 2024 Senior Notes.

Revenue for the three months ended March 31, 2021 increased by $29.0 million, of which $40.1 million was the result of higher average realized gold and silver prices, partially offset by a decrease of $11.1 million due to lower volume of gold and silver sales.

Cash Used in Investing Activities

Net cash used in investing activities in the three months ended March 31, 2021 was $53.9 million compared to $17.7 million in the three months ended March 31, 2020.

Cash used in investing activities increased primarily due to the commencement of construction activities related to POA 11 in August 2020 at Rochester.

The Company incurred capital expenditures of $59.4 million in the three months ended March 31, 2021 compared with $22.2 million in the three months ended March 31, 2020.

Capital expenditures in the three months ended March 31, 2021 were primarily related to POA 11 construction activities at Rochester, potential expansion expenditures at Silvertip and underground development at Palmarejo and Kensington.

Capital expenditures in the three months ended March 31, 2020 were primarily related to underground development at Silvertip, Palmarejo, and Kensington and POA 11 capital expenditures at Rochester.

Cash Provided by Financing Activities

Net cash provided by financing activities in the three months ended March 31, 2021 was $119.6 million compared to $23.4 million in the three months ended March 31, 2020.

During the three months ended March 31, 2021, the Company received net proceeds of $367.5 million from the issuance of the 2029 Senior Notes, partially offset by the tender and redemption of the 2024 Senior Notes for $238.3 million, including premiums.

During the three months ended March 31, 2020, the Company drew $50.0 million from the RCF, partially offset by the payment of contingent consideration of $18.8 million associated with the Silvertip acquisition.

Net cash provided by operating activities increased $48.1 million for the three months ended June 30, 2021 compared to the three months ended June 30, 2020, primarily due to a 1% and 64% increase in average realized gold and silver prices, respectively, higher ounces sold of gold and silver (14% and 59%, respectively), improved recoveries at Rochester, and a reduction in accounts payable at Silvertip due the temporary suspension in 2020.

Revenue for the three months ended June 30, 2021 increased by $60.6 million, of which $43.0 million was the result of the higher volume of gold and silver sales and $17.6 million was due to higher average realized gold and silver prices.

Net cash provided by operating activities increased $51.7 million for the six months ended June 30, 2021, primarily due to a 6% and 60% increase in average realized gold and silver prices, respectively, higher gold and silver ounces sold (5% and 16%, respectively), improved recoveries at Rochester, a reduction in accounts payable at Silvertip due the temporary suspension in 2020, partially offset by a payment of $4.0 million of interest related to the tender and redemption of the 2024 Senior Notes.

Revenue for the six months ended June 30, 2021 increased by $89.6 million, of which $57.8 million was the result of higher average realized gold and silver prices and $31.7 million was due to the higher volume of gold and silver sales.

Cash Provided by (Used in) Investing Activities

Net cash used in investing activities in the three months ended June 30, 2021 was $78.1 million compared to net cash provided by investing activities $2.9 million in the three months ended June 30, 2020.

Cash used in investing activities increased primarily due to construction activities related to POA 11 at Rochester in the current period and the impact of the net proceeds of $19.4 million from the sale of Metalla Common Shares in the comparable period of 2020.

The Company incurred capital expenditures of $78.2 million in the three months ended June 30, 2021 compared with $16.7 million in the three months ended June 30, 2020.

Capital expenditures in the three months ended June 30, 2021 were primarily related to POA 11 construction activities at Rochester, potential expansion expenditures at Silvertip and underground development at Palmarejo and Kensington.

Capital expenditures in the three months ended June 30, 2020 were primarily related to underground development at Silvertip, Palmarejo, and Kensington and POA 11 capital expenditures at Rochester.

Net cash used in investing activities in the six months ended June 30, 2021 was $132.1 million compared to $14.8 million in the six months ended June 30, 2020.

The Company incurred capital expenditures of $137.6 million in the six months ended June 30, 2021 compared with $38.9 million in the six months ended June 30, 2020.

Capital expenditures in the six months ended June 30, 2021 were primarily related to POA 11 construction activities at Rochester, potential expansion expenditures at Silvertip and underground development at Palmarejo and Kensington.

Capital expenditures in the six months ended June 30, 2020 were primarily related to underground development at Silvertip, Palmarejo, and Kensington and POA 11 capital expenditures at Rochester.

Recently-signed construction contracts related to POA 11 have begun demonstrating signs of inflationary pressures, specifically with respect to building materials and fuel as well as overall tightness in the construction market.

Cash Provided by (Used in) Financing Activities

Net cash used in financing activities in the three months ended June 30, 2021 was $9.8 million compared to net cash provided by financing activities of $4.4 million in the three months ended June 30, 2020.

During the three months ended June 30, 2021, the Company repaid $9.6 million of principal under outstanding finance leases.

During the three months ended June 30, 2020, the Company borrowed $100.0 million and repaid $90.0 million under the RCF.

Net cash provided by financing activities in the six months ended June 30, 2021 was $109.8 million compared to $27.8 million in the six months ended June 30, 2020.

During the six months ended June 30, 2021, the Company received net proceeds of $367.5 million from the issuance of the 2029 Senior Notes, partially offset by the tender and redemption of the 2024 Senior Notes for $238.3 million, including premiums.

During the six months ended June 30, 2020, the Company drew $150.0 million from the RCF, partially offset by the repayment of $90.0 million under the RCF and the payment of contingent consideration of $18.8 million associated with the Silvertip acquisition.

The Company secured a finance lease package for nearly $60 million during the quarter, a portion of which has been funded as of June 30, 2021.

The package is earmarked for planned equipment purchases for the project in 2021 and 2022, and has an interest rate of 5.20%.

Critical Accounting Policies and Accounting Developments

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Adjusted net income (loss) is reconciled to Net income (loss) in the following table:

Three Months Ended March 31,

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

In thousands except per share amounts 2021 2020 2021 2020

5 unchanged sentences

Silvertip inventory write-down — 2,104 — 12,485

Wharf inventory write-down — 3,323 — 3,323

Silvertip temporary suspension costs — 1,725 — 5,234

2 unchanged sentences

COVID-19 costs 2,315 6,108 5,319 6,380

Tax effect of adjustments (1)

1,056 — 1,056 —

Adjusted net income (loss) $ (840) $ 2,601 $ 13,100 $ 1,682

1 unchanged sentence

Adjusted net income (loss) per share - Diluted $ 0.00 $ 0.01 $ 0.05 $ 0.01

(1) For the three and six months ended June 30, 2021, tax effect of adjustments of $1.1 million (3%) and $1.1 million (4%) are primarily related to the fair value adjustments on the Company’s equity investments.

EBITDA and Adjusted EBITDA

5 unchanged sentences

Adjusted EBITDA is reconciled to Net income (loss) in the following table:

Three Months Ended March 31,

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

In thousands except per share amounts 2021 2020 2021 2020

Net income (loss) $ 32,146 $ (1,209) $ 34,206 $ (13,109)

(Income) loss from discontinued operations, net of tax — — — —

Interest expense, net of capitalized interest 5,093 5,765 10,003 10,893

13 unchanged sentences

COVID-19 costs 2,315 6,108 5,319 6,380

Wharf inventory write-down — 3,323 — 3,323

Adjusted EBITDA $ 52,738 $ 42,150 $ 118,603 $ 88,601

5 unchanged sentences

The following table sets forth a reconciliation of Free Cash Flow, a non-GAAP financial measure, to Cash Provided By (used in) Operating Activities , which the Company believes to be the GAAP financial measure most directly comparable to Free Cash Flow.

Three Months Ended March 31,

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

(Dollars in thousands) 2021 2020 2021 2020

8 unchanged sentences

The following table sets forth a reconciliation of Operating Cash Flow Before Changes in Working Capital, a non-GAAP financial measure, to Cash Provided By (used in) Operating Activities , which the Company believes to be the GAAP financial measure most directly comparable to Operating Cash Flow Before Changes in Working Capital.

Three Months Ended March 31,

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

(Dollars in thousands) 2021 2020 2021 2020

12 unchanged sentences

Other companies may calculate CAS differently as a result of reflecting the benefit from selling non-silver metals as a by-product credit, converting to silver equivalent ounces, and differences in underlying accounting principles and accounting frameworks such as in International Financial Reporting Standards.

Three Months Ended March 31, 2021

Three Months Ended June 30, 2021

In thousands (except metal sales, per ounce and per pound amounts) Palmarejo Rochester Kensington Wharf Silvertip Total

12 unchanged sentences

Lead ($/lb) $ —

Three Months Ended March 31, 2020

Three Months Ended June 30, 2020

In thousands (except metal sales, per ounce and per pound amounts) Palmarejo Rochester Kensington Wharf Silvertip Total

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Gold ($/oz) $ 690 $ 1,529 $ 939 $ 945

Silver ($/oz) $ 8.18 $ 14.19 $ —

Zinc ($/lb) $ —

Lead ($/lb) $ —

Six Months Ended June 30, 2021

In thousands (except metal sales, per ounce and per pound amounts) Palmarejo Rochester Kensington Wharf Silvertip Total

Costs applicable to sales, including amortization (U.S.

GAAP) $ 93,236 $ 72,147 $ 86,752 $ 47,644 $ 2,271 $ 302,050

Amortization (17,330) (10,083) (26,155) (5,469) (2,271) (61,308)

Costs applicable to sales $ 75,906 $ 62,064 $ 60,597 $ 42,175 $ — $ 240,742

Gold ounces 56,203 14,752 58,391 42,267 171,613

Silver ounces 3,277,315 1,683,215 57,876 — 5,018,406

Zinc pounds — —

Lead pounds — —

Costs applicable to sales

Gold ($/oz) $ 648 $ 1,557 $ 1,038 $ 961

Silver ($/oz) $ 12.04 $ 23.23 $ —

Zinc ($/lb) $ —

Lead ($/lb) $ —

Six Months Ended June 30, 2020

In thousands (except metal sales, per ounce and per pound amounts) Palmarejo Rochester Kensington Wharf Silvertip Total

Costs applicable to sales, including amortization (U.S.

GAAP) $ 75,244 $ 41,208 $ 85,664 $ 45,920 $ 24,233 $ 272,269

Amortization (20,445) (5,916) (24,775) (5,625) (6,576) (63,337)

Costs applicable to sales $ 54,799 $ 35,292 $ 60,889 $ 40,295 $ 17,657 $ 208,932

Gold ounces 48,211 10,751 65,148 39,458 163,568

Silver ounces 2,769,431 1,355,916 37,475 158,984 4,321,806

Zinc pounds 3,203,446 3,203,446

Lead pounds 2,453,485 2,453,485

Costs applicable to sales

Gold ($/oz) $ 659 $ 1,444 $ 935 $ 1,005

Silver ($/oz) $ 8.31 $ 14.58 NM (1)

3 unchanged sentences

Cautionary Statement Concerning Forward-Looking Statements

This report contains numerous forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) relating to the Company’s gold, silver, zinc and lead mining business, including statements regarding operations at the Company’s mines, exploration and development efforts, expectations regarding the Rochester POA 11 expansion project, COVID-19 planning, response and mitigation efforts, hedging strategies, realization of deferred tax assets, expectations about the recovery of VAT in Mexico, timing of completion of obligations under the Amended Sales Contract at Kensington, liquidity management, financing plans, and risk management strategies.

This report contains numerous forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) relating to the Company’s gold, silver, zinc and lead mining business, including statements regarding operations at the Company’s mines, exploration and development efforts, strategies, expectations regarding the Rochester POA 11 expansion project, the Silvertip mine's planned restart, COVID-19 planning, response and mitigation efforts, hedging strategies, realization of deferred tax assets, expectations about the recovery of VAT in Mexico, timing of completion of obligations under the Amended Sales Contract at Kensington, liquidity management, financing plans, risk management strategies, capital allocation and anticipated production, costs, and expenses.

Such forward-looking statements are identified by the use of words such as “believes,” “intends,” “expects,” “hopes,” “may,” “should,” “plan,” “projected,” “contemplates,” “anticipates” or similar words.

4 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 2. Management’s Discussion and Analysis