Segment Reporting

6 Months Ended

Jun. 30, 2012

Segment Reporting [Abstract]

Segment Reporting

SEGMENT REPORTING

Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. The Company’s chief operating decision-making group is comprised of the Chief Executive Officer, Chief Financial Officer, and the Chief Operating Officer.

The operating segments are managed separately because each segment represents a distinct use of company resources and a separate contribution to the Company’s cash flows. The Company’s reportable operating segments include the Palmarejo, San Bartolomé, Martha, Rochester, Kensington and Endeavor mining properties. All operating segments are engaged in the discovery and/or mining of gold and silver and generate the majority of their revenues from the sale of these precious metal concentrates and/or refined precious metals. The Martha mine sells precious metal concentrates, typically under long-term contracts, to trading partners located in the United States and Switzerland. The Kensington mine sells precious metals and concentrates, typically under long-term contracts to smelters in China and Germany. Refined gold and silver produced by the Rochester, Palmarejo, and San Bartolomé mines are principally sold on a spot basis to precious metals trading banks such as International Commodities, Mitsui, Mitsubishi, Standard Bank, TD Securities, Valcambi and Auramet. Concentrates produced at the Endeavor mine are sold to Nyrstar (formerly Zinifex), an Australian smelter. The Company’s exploration programs are reported in its other segment. The other segment also includes the corporate headquarters, elimination of intersegment transactions and other items necessary to reconcile to consolidated amounts. The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies above. The Company evaluates performance and allocates resources based on profit or loss before interest, income taxes, depreciation and amortization, unusual and infrequent items and extraordinary items.

Revenues from silver sales were $160.7 million and $158.8 million and $299.9 million, and $271.3 million in the three and six months ended June 30, 2012 and 2011, respectively. Revenues from gold sales were $93.7 million and $72.3 million, and $159.0 and $159.4 million in the three and six months ended June 30, 2012 and 2011, respectively.

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

Three months ended June 30, 2012	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	136,365		$	53,383		$	21,124		$	34,153		$	4,149		$	5,232		$	—		$	254,406
Productions costs applicable to sales	(62,538		)	(22,773		)	(16,106		)	(20,751		)	(7,102		)	(2,553		)	—			(131,823		)
Depreciation and depletion	(42,748		)	(4,070		)	(9,719		)	(2,060		)	(704		)	(1,592		)	(131		)	(61,024		)
Gross profit (loss)	31,079			26,540			(4,701		)	11,342			(3,657		)	1,087			(131		)	61,559
Exploration expense	1,624			(70		)	274			1,135			2,763			—			579			6,305
Loss on impairment	—			—			—			—			4,813			—			—			4,813
Other operating expenses	—			25			16			692			81			—			8,053			8,867
OPERATING INCOME (LOSS)	29,455			26,585			(4,991		)	9,515			(11,314		)	1,087			(8,763		)	41,574
Interest and other income, net	(4,720		)	631			—			239			(494		)	—			1,123			(3,221		)
Interest expense, net	(5,672		)	(36		)	(901		)	(7		)	(1		)	—			(940		)	(7,557		)
Fair value adjustments, net	14,105			—			2,187			—			—			—			(253		)	16,039
Income tax expense	(11,967		)	(10,889		)	—			—			(28		)	—			(978		)	(23,862		)
Net income (loss)	$	21,201		$	16,291		$	(3,705	)	$	9,747		$	(11,837	)	$	1,087		$	(9,811	)	$	22,973
Segment assets (A)	$	1,954,084		$	289,428		$	518,611		$	94,677		$	13,070		$	33,228		$	16,654		$	2,919,752
Capital expenditures (B)	$	11,174		$	7,800		$	9,324		$	2,946		$	529		$	—		$	465		$	32,238

Three months ended June 30, 2011	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	123,727		$	55,598		$	26,012		$	14,434		$	4,769		$	6,550		$	—		$	231,090
Productions costs applicable to sales	(37,770		)	(14,126		)	(12,844		)	(5,341		)	(3,749		)	(3,272		)	—			(77,102		)
Depreciation and depletion	(41,753		)	(5,182		)	(9,890		)	(584		)	747			(865		)	(114		)	(57,641		)
Gross profit (loss)	44,204			36,290			3,278			8,509			1,767			2,413			(114		)	96,347
Exploration expense	1,276			31			320			340			1,527			—			583			4,077
Other operating expenses	—			70			116			11,025			—			—			1,720			12,931
OPERATING INCOME (LOSS)	42,928			36,189			2,842			(2,856		)	240			2,413			(2,417		)	79,339
Interest and other income, net	539			180			2			5			(179		)	—			2,216			2,763
Interest expense, net	(6,112		)	(2		)	(1,360		)	—			(68		)	—			(1,726		)	(9,268		)
Loss on debt extinguishment	—			—			—			—			—			—			(389		)	(389		)
Fair value adjustments, net	(13,731		)	—			2,374			—			—			—			(1,075		)	(12,432		)
Income tax expense	(6,286		)	(12,109		)	—			—			(410		)	(3		)	(2,594		)	(21,402		)
Net income (loss)	$	17,338		$	24,258		$	3,858		$	(2,851	)	$	(417	)	$	2,410		$	(5,985	)	$	38,611
Segment assets (A)	$	2,095,411		$	269,439		$	507,531		$	35,606		$	19,341		$	40,760		$	16,201		$	2,984,289
Capital expenditures (B)	$	10,278		$	3,276		$	7,365		$	4,201		$	573		$	—		$	71		$	25,764

(A) Segment assets consist of receivables, prepaids, inventories, property, plant and equipment, and mining properties

(B) Balance represents cash flow amounts 

Six months ended June 30, 2012	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	260,087		$	94,759		$	31,500		$	52,911		$	7,767		$	11,946		$	—		$	458,970
Productions costs applicable to sales	(108,397		)	(36,381		)	(33,197		)	(30,317		)	(10,795		)	(5,290		)	—			(224,377		)
Depreciation and depletion	(80,517		)	(8,289		)	(16,324		)	(3,702		)	(1,300		)	(3,236		)	(248		)	(113,616		)
Gross profit (loss)	71,173			50,089			(18,021		)	18,892			(4,328		)	3,420			(248		)	120,977
Exploration expense	2,945			—			496			1,844			6,174			—			1,413			12,872
Loss on impairment	—			—			—			—			4,813			—			—			4,813
Other operating expenses	—			30			35			2,033			279			—			15,154			17,531
OPERATING INCOME (LOSS)	68,228			50,059			(18,552		)	15,015			(15,594		)	3,420			(16,815		)	85,761
Interest and other income, net	(139		)	726			—			288			(570		)	—			1,481			1,786
Interest expense, net	(10,481		)	(36		)	(1,793		)	(15		)	(1		)	—			(1,901		)	(14,227		)
Fair value adjustments, net	(11,505		)	—			1,636			—			—			—			2,795			(7,074		)
Income tax expense	(15,511		)	(18,578		)	—			—			(239		)	—			(4,970		)	(39,298		)
Net income (loss)	$	30,592		$	32,171		$	(18,709	)	$	15,288		$	(16,404	)	$	3,420		$	(19,410	)	$	26,948
Segment assets (A)	$	1,954,084		$	289,428		$	518,611		$	94,677		$	13,070		$	33,228		$	16,654		$	2,919,752
Capital expenditures (B)	$	18,344		$	18,007		$	20,202		$	5,585		$	1,188		$	—		$	559		$	63,885

Six months ended June 30, 2011	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	211,892		$	101,919		$	74,122		$	28,696		$	4,455		$	9,630		$	—		$	430,714
Productions costs applicable to sales	(75,139		)	(28,244		)	(45,764		)	(12,698		)	(3,359		)	(4,372		)	—			(169,576		)
Depreciation and depletion	(75,428		)	(10,325		)	(19,255		)	(1,098		)	155			(1,484		)	(247		)	(107,682		)
Gross profit (loss)	61,325			63,350			9,103			14,900			1,251			3,774			(247		)	153,456
Exploration expense	1,912			35			366			362			2,823			—			1,341			6,839
Other operating expenses	—			108			136			14,561			—			—			13,931			28,736
OPERATING INCOME (LOSS)	59,413			63,207			8,601			(23		)	(1,572		)	3,774			(15,519		)	117,881
Interest and other income, net	1,828			787			3			51			(489		)	—			2,484			4,664
Interest expense, net	(11,815		)	(36		)	(2,607		)	—			(413		)	—			(3,702		)	(18,573		)
Loss on debt extinguishment	—			—			—			—			—			—			(856		)	(856		)
Fair value adjustments, net	(20,041		)	—			1,676			—			—			—			665			(17,700		)
Income tax expense	(10,062		)	(22,146		)	(20		)	—			(369		)	(3		)	(1,741		)	(34,341		)
Net income (loss)	$	19,323		$	41,812		$	7,653		$	28		$	(2,843	)	$	3,771		$	(18,669	)	$	51,075
Segment assets (A)	$	2,095,411		$	269,439		$	507,531		$	35,606		$	19,341		$	40,760		$	16,201		$	2,984,289
Capital expenditures (B)	$	15,359		$	6,812		$	12,734		$	5,869		$	824		$	—		$	83		$	41,681

(A) Segment assets consist of receivables, prepaids, inventories, property, plant and equipment, and mining properties

(B) Balance represents cash flow amounts 

	June 30, 2012		December 31, 2011
Assets
Total assets for reportable segments	$	2,919,752	$	2,963,130
Cash and cash equivalents	199,397		175,012
Short term investments	907		20,254
Other assets	113,454		106,045
Total consolidated assets	$	3,233,510	$	3,264,441

Geographic Information

	June 30, 2012		December 31, 2011
Long Lived Assets:
United States	$	522,057	$	515,096
Australia	30,763		33,999
Chile	65		65
Argentina	1,775		5,213
Bolivia	240,879		230,956
Mexico	1,843,250		1,903,375
Total	$	2,638,789	$	2,688,704

	Three months ended June 30,				Six months ended June 30,
	2012		2011		2012		2011
Revenues:
United States	$	55,277	$	40,446	$	84,411	$	102,818
Mexico	136,365		123,727		260,087		211,892
Bolivia	53,383		55,598		94,759		101,919
Australia	5,232		6,550		11,946		9,630
Argentina	4,149		4,769		7,767		4,455
Total	$	254,406	$	231,090	$	458,970	$	430,714