Segment Reporting

9 Months Ended

Sep. 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.    

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

Three months ended September 30, 2012	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	102,642		$	46,192		$	36,450		$	36,244		$	4,933		$	4,132		$	—		$	230,593
Productions costs applicable to sales	(48,672		)	(19,937		)	(26,881		)	(21,014		)	(6,481		)	(1,982		)	—			(124,967		)
Depreciation and depletion	(34,007		)	(4,163		)	(11,512		)	(2,061		)	(32		)	(898		)	(171		)	(52,844		)
Gross profit (loss)	19,963			22,092			(1,943		)	13,169			(1,580		)	1,252			(171		)	52,782
Exploration expense	2,288			50			1,476			1,158			1,217			—			768			6,957
Loss on impairment	—			—			—			—			1,293			—			—			1,293
Other operating expenses	—			50			39			1,109			133			—			9,212			10,543
OPERATING INCOME (LOSS)	17,675			21,992			(3,458		)	10,902			(4,223		)	1,252			(10,151		)	33,989
Interest and other income, net	4,914			8,353			—			59			(342		)	—			(320		)	12,664
Interest expense, net	(4,401		)	(11		)	(1,834		)	(6		)	(2		)	—			(1,097		)	(7,351		)
Fair value adjustments, net	(34,266		)	—			(4,283		)	—			—			—			901			(37,648		)
Income tax expense	5,495			(23,106		)	—			—			1,233			(202		)	(895		)	(17,475		)
Net income (loss)	$	(10,583	)	$	7,228		$	(9,575	)	$	10,955		$	(3,334	)	$	1,050		$	(11,562	)	$	(15,821	)
Segment assets (A)	$	1,926,695		$	299,041		$	520,619		$	104,066		$	11,339		$	32,619		$	18,613		$	2,912,992
Capital expenditures (B)	$	11,321		$	4,406		$	9,034		$	4,777		$	6		$	—		$	428		$	29,972

Three months ended September 30, 2011	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	166,875		$	102,820		$	44,185		$	17,453		$	6,037		$	6,205		$	—		$	343,575
Productions costs applicable to sales	(64,112		)	(30,085		)	(24,347		)	(11,356		)	(8,143		)	(3,210		)	—			(141,253		)
Depreciation and depletion	(41,182		)	(6,067		)	(9,567		)	(573		)	(237		)	(914		)	(112		)	(58,652		)
Gross profit (loss)	61,581			66,668			10,271			5,524			(2,343		)	2,081			(112		)	143,670
Exploration expense	2,200			61			308			242			1,477			—			484			4,772
Other operating expenses	225			111			88			3,158			150			(1		)	7,776			11,507
OPERATING INCOME (LOSS)	59,156			66,496			9,875			2,124			(3,970		)	2,082			(8,372		)	127,391
Interest and other income, net	(6,278		)	(227		)	1			7			(99		)	—			(14		)	(6,610		)
Interest expense, net	(5,270		)	(9		)	(1,115		)	(14		)	(35		)	—			(1,537		)	(7,980		)
Loss on debt extinguishment	—			—			—			—			—			—			(784		)	(784		)
Fair value adjustments, net	(26,464		)	—			(22,244		)	—			—			—			(4,643		)	(53,351		)
Income tax expense	(2,459		)	(25,063		)	(1		)	—			(173		)	107			(17		)	(27,606		)
Net income (loss)	$	18,685		$	41,197		$	(13,484	)	$	2,117		$	(4,277	)	$	2,189		$	(15,367	)	$	31,060
Segment assets (A)	$	2,050,108		$	265,488		$	515,335		$	55,734		$	19,537		$	37,546		$	17,693		$	2,961,441
Capital expenditures (B)	$	9,528		$	4,418		$	9,230		$	13,559		$	1,130		$	—		$	234		$	38,099

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

(B) Balance represents cash flow amounts 

Nine months ended September 30, 2012	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	362,729		$	140,951		$	67,950		$	89,156		$	12,700		$	16,077		$	—		$	689,563
Productions costs applicable to sales	(157,070		)	(56,317		)	(60,078		)	(51,331		)	(17,276		)	(7,272		)	—			(349,344		)
Depreciation and depletion	(114,525		)	(12,452		)	(27,836		)	(5,763		)	(1,332		)	(4,134		)	(418		)	(166,460		)
Gross profit (loss)	91,134			72,182			(19,964		)	32,062			(5,908		)	4,671			(418		)	173,759
Exploration expense	5,232			51			1,971			3,003			7,391			—			2,181			19,829
Loss on impairment	—			—			—			—			6,106			—			—			6,106
Other operating expenses	—			80			75			3,142			411			—			24,366			28,074
OPERATING INCOME (LOSS)	85,902			72,051			(22,010		)	25,917			(19,816		)	4,671			(26,965		)	119,750
Interest and other income, net	4,774			9,079			1			347			(912		)	—			1,161			14,450
Interest expense, net	(14,883		)	(47		)	(3,627		)	(21		)	(3		)	—			(2,997		)	(21,578		)
Fair value adjustments, net	(45,771		)	—			(2,647		)	—			—			—			3,696			(44,722		)
Income tax expense	(10,015		)	(41,684		)	—			—			993			(202		)	(5,865		)	(56,773		)
Net income (loss)	$	20,007		$	39,399		$	(28,283	)	$	26,243		$	(19,738	)	$	4,469		$	(30,970	)	$	11,127
Segment assets (A)	$	1,926,695		$	299,041		$	520,619		$	104,066		$	11,339		$	32,619		$	18,613		$	2,912,992
Capital expenditures (B)	$	29,665		$	22,413		$	29,235		$	10,362		$	1,194		$	—		$	988		$	93,857

Nine months ended September 30, 2011	Palmarejo Mine			San Bartolomé Mine			Kensington Mine			Rochester Mine			Martha Mine			Endeavor Mine			Other			Total
Sales of metals	$	378,767		$	204,739		$	118,307		$	46,149		$	10,492		$	15,835		$	—		$	774,289
Productions costs applicable to sales	(139,251		)	(58,329		)	(70,111		)	(24,054		)	(11,502		)	(7,582		)	—			(310,829		)
Depreciation and depletion	(116,610		)	(16,392		)	(28,822		)	(1,671		)	(82		)	(2,398		)	(359		)	(166,334		)
Gross profit (loss)	122,906			130,018			19,374			20,424			(1,092		)	5,855			(359		)	297,126
Exploration expense	4,112			96			674			604			4,300			—			1,825			11,611
Other operating expenses	225			219			224			17,719			150			(1		)	21,707			40,243
OPERATING INCOME (LOSS)	118,569			129,703			18,476			2,101			(5,542		)	5,856			(23,891		)	245,272
Interest and other income, net	(4,450		)	560			4			58			(588		)	—			2,470			(1,946		)
Interest expense, net	(17,085		)	(45		)	(3,722		)	(14		)	(448		)	—			(5,239		)	(26,553		)
Loss on debt extinguishment	—			—			—			—			—			—			(1,640		)	(1,640		)
Fair value adjustments, net	(46,505		)	—			(20,568		)	—			—			—			(3,978		)	(71,051		)
Income tax expense	(12,521		)	(47,209		)	(21		)	—			(542		)	104			(1,758		)	(61,947		)
Net income (loss)	$	38,008		$	83,009		$	(5,831	)	$	2,145		$	(7,120	)	$	5,960		$	(34,036	)	$	82,135
Segment assets (A)	$	2,050,108		$	265,488		$	515,335		$	55,734		$	19,537		$	37,546		$	17,693		$	2,961,441
Capital expenditures (B)	$	24,887		$	11,230		$	21,964		$	19,428		$	1,954		$	—		$	317		$	79,780

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

(B) Balance represents cash flow amounts 

	September 30, 2012		December 31, 2011
Assets
Total assets for reportable segments	$	2,912,992	$	2,963,130
Cash and cash equivalents	142,915		175,012
Short term investments	657		20,254
Other assets	123,876		106,045
Total consolidated assets	$	3,180,440	$	3,264,441

Geographic Information

	September 30, 2012		December 31, 2011
Long Lived Assets:
United States	$	522,595	$	515,096
Australia	29,865		33,999
Chile	65		65
Argentina	1,772		5,213
Bolivia	241,890		230,956
Mexico	1,818,283		1,903,374
Total	$	2,614,470	$	2,688,703

	Three months ended September 30,				Nine months ended September 30,
	2012		2011		2012		2011
Revenues:
United States	$	72,694	$	61,638	$	157,106	$	164,456
Mexico	102,642		166,875		362,729		378,767
Bolivia	46,192		102,820		140,951		204,739
Australia	4,132		6,205		16,077		15,835
Argentina	4,933		6,037		12,700		10,492
Total	$	230,593	$	343,575	$	689,563	$	774,289