Note 6 - Business Segments

3 Months Ended

Mar. 31, 2013

Segment Reporting Disclosure [Text Block]

Note 6.    Business Segments

We are currently organized and managed in two reporting segments: the Greens Creek unit and the Lucky Friday unit.  On March 3, 2013, we and Aurizon Mines Ltd. ("Aurizon")  entered into a definitive arrangement agreement pursuant to which we would acquire all of the issued and outstanding common shares of Aurizon.  See Note 13 for more information.  If the acquisition is consummated, our reporting segments would change to include the acquired operations.

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.

The following tables present information about reportable segments for the three months ended March 31, 2013 and 2012 (in thousands):

	Three Months Ended March 31,
	2013			2012
Net sales to unaffiliated customers:
Greens Creek	$	72,649		$	90,900
Lucky Friday		3,801			253
	$	76,450		$	91,153
Income (loss) from operations:
Greens Creek	$	27,189		$	47,382
Lucky Friday		(3,847	)		(5,943	)
Other		(25,555	)		(16,003	)
	$	(2,213	)	$	25,436

The limited sales and loss from operations at the Lucky Friday segment for the first quarter of 2012 were due to the suspension of production at the Lucky Friday mine during all of 2012.  At the end of 2011, MSHA began a special impact inspection at the Lucky Friday mine which resulted in an order to remove loose cementitious material from the Silver Shaft. In response, we submitted a plan to MSHA and received approval to remove the material, and this work commenced in the first quarter of 2012. In addition, the plan included the removal of unused utilities, construction of a water ring to prevent ice from forming in the winter, the installation of a metal brattice, repair of shaft steel, and installation of a new power cable, all of which should improve the shaft's functionality and possibly improve the shaft's hoisting capacity.   Once the Silver Shaft work was completed down to the 4900 foot level, work began on a haulage way bypassing an area at the 5900 foot level impacted by a rock burst in December 2011.  Work on the Silver Shaft and haulage way was completed in early 2013, and we recommenced limited production at the Lucky Friday mine in February 2013.  In the first quarter of  2013, we incurred $1.5 million in non-capitalized expenses, including $0.6 million in depreciation, depletion, and amortization, which is reported in Lucky Friday suspension-related costs on the Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited).

The following table presents identifiable assets by reportable segment as of March 31, 2013 and December 31, 2012 (in thousands):

	March 31, 2013		December 31, 2012
Identifiable assets:
Greens Creek	$	746,417	$	741,666
Lucky Friday		221,316		226,196
Other		412,379		410,428
	$	1,380,112	$	1,378,290