Note 11. Business Segments and Significant Customers

12 Months Ended

Dec. 31, 2011

Segment Reporting Disclosure [Text Block]

Note 11: Business Segments and Significant Customers

We discover, acquire, develop, produce, and market silver, gold, lead and zinc.  Our products consist of both metal concentrates, which we sell to custom smelters, and unrefined bullion bars (doré), which may be sold as doré or further refined before sale to precious metals traders.  We are currently organized and managed by two segments, which represent our operating units: the Greens Creek unit and the Lucky Friday unit.

General corporate activities not associated with operating units and their various exploration activities, as well as discontinued operations and idle properties, are presented as “other.”  Interest expense, interest income and income taxes are considered general corporate items, and are not allocated to our segments.

Sales of metal concentrates and metal products are made principally to custom smelters and metals traders. The percentage of sales contributed by each segment is reflected in the following table:

	Year Ended December 31,
	2011			2010			2009
Greens Creek		71.8	%		74.8	%		73.4	%
Lucky Friday		28.2	%		25.2	%		26.6	%
		100	%		100	%		100	%

The tables below present information about reportable segments as of and for the years ended December 31, 2011, 2010 and 2009 (in thousands).

	2011			2010			2009
Net sales from continuing operations to unaffiliated customers:
Greens Creek	$	342,906		$	313,318		$	229,318
Lucky Friday		134,728			105,495			83,230
	$	477,634		$	418,813		$	312,548
Income (loss) from operations:
Greens Creek	$	181,116		$	138,973		$	79,329
Lucky Friday		75,608			48,639			27,146
Other		(59,079	)		(239,167	)		(31,203	)
	$	197,645		$	(51,555	)	$	75,272
Capital additions (including non-cash additions):
Greens Creek	$	41,657		$	18,280		$	17,520
Lucky Friday		60,454			54,370			15,990
Other		35,274			2,089			30
	$	137,385		$	74,739		$	33,540

Depreciation, depletion and amortization from continuing operations:
Greens Creek	$	41,013	$	51,671	$	52,909
Lucky Friday		6,053		8,340		9,928
	$	47,066	$	60,011	$	62,837
Other significant non-cash items from continuing operations:
Greens Creek	$	2,326	$	17,829	$	2,974
Lucky Friday		14		5,053		22
Other		31,470		57,651		(6,687	)
	$	33,810	$	80,533	$	(3,691	)
Identifiable assets:
Greens Creek	$	729,289	$	740,573	$	771,433
Lucky Friday		213,285		170,928		116,797
Other		453,516		470,992		158,554
	$	1,396,090	$	1,382,493	$	1,046,784

The following is sales information by geographic area, based on the location of concentrate shipments and location of parent company for sales from continuing operations to metal traders, for the years ended December 31, 2011 (in thousands):

	2011		2010		2009
United States	$	24,409	$	24,708	$	19,127
Canada		240,569		124,862		136,248
Mexico		—		16,258		20,413
Japan		60,963		62,740		43,356
Korea		92,919		94,114		77,492
China		51,635		73,257		15,912
Belgium		—		25,907		—
Total, excluding gains/losses on forward contracts	$	470,495	$	421,846	$	312,548

Sales of products for the year ended December 31, 2011 also include a net gain of $7.1 million on financially-settled forward contracts for lead and zinc contained in our concentrate sales.  See Note 10 for more information.

The following are our long-lived assets by geographic area as of December 31, 2011 (in thousands):

	2011		2010
United States	$	923,040	$	833,186
Canada		99		10
Mexico		73		92
	$	923,212	$	833,288

Sales from continuing operations to significant metals customers as a percentage of total sales were as follows for the years ended December 31, 2011, 2010 and 2009:

	Year Ended December 31,
	2011			2010			2009
Teck Metals Ltd.		51.1	%		29.6	%		43.6	%
Korea Zinc		18.4	%		20.7	%		23.4	%
Trafigura AG		12.4	%		17.4	%		—