Coeur back in the black

Vancouver — Debt restructuring propelled Coeur d’Alene Mines (CDE-N) to a profit of US$26.9 million, or 62 per share in the third quarter of 2001.

Driving the profit picture was the early retirement of US$40.6 million in debt resulting in a one-time gain of US$39.2 million. Since late 1998, the company has embarked on repurchasing its convertible debentures at a discount to its original value. Since the launch of the program, Coeur has reduced long-term debt by US$140.3 million and reduced yearly interest payments by US$10.3 million. In the latest three-month period, the program managed to reverse a loss of US$8.5 million, or 23 per share the company posted in the third quarter of 2000.

Coeur produced 3.7 million oz. silver during the quarter ended Sept. 30, down 4.6% from the 3.9 million oz. recorded in the same period one year ago. Cash costs came in at US$4.14 per oz., up from the US$3.99 per oz. tallied in the third quarter of 2000.

Most of the silver came from the Rochester open-pit mine in northern Nevada, which contributed 1.5 million oz., plus 18,171 oz. gold. This compares to the 1.6 million oz. of silver and 19,334 oz. of gold tabled in the third quarter of 2000. The company has completed a 37,000-ft. program of reverse-circulation drilling at the property and expects to table an updated reserve model by the end of the year.

Silver production at the Silver Valley operation in northern Idaho dropped to 1.06 million oz., from the 1.16 million oz. tallied in the corresponding period last year. Total cash costs rose to US$4.97 per oz. from US$3.93 per oz. Difficult ground conditions at the mine are cited for the production shortfall. Coeur doubled its stake in Silver Valley to 100% in September 1999.

Coeur is moving ahead with development of the Cerro Bayo discovery, 9 miles east of the Fachinal mill in southern Chile. To date, the company has outlined a total reserve-resource of 2.23 million tons grading 0.24 oz gold equivalent for 535,000 gold-equivalent oz. Initial production is slated for May 2002.

In Bolivia, Coeur expects to have a final feasibility study in hand on the San Bartolome project by the first quarter of next year. The company expects to significantly increase the current resource of 41.1 million tons grading 2.97 oz silver per ton.