0000921638-18-000038.txt : 20180511 0000921638-18-000038.hdr.sgml : 20180511 20180510210007 ACCESSION NUMBER: 0000921638-18-000038 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 8 CONFORMED PERIOD OF REPORT: 20180331 FILED AS OF DATE: 20180511 DATE AS OF CHANGE: 20180510 FILER: COMPANY DATA: COMPANY CONFORMED NAME: SSR MINING INC. CENTRAL INDEX KEY: 0000921638 STANDARD INDUSTRIAL CLASSIFICATION: MINERAL ROYALTY TRADERS [6795] IRS NUMBER: 000000000 STATE OF INCORPORATION: A1 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-35455 FILM NUMBER: 18824725 BUSINESS ADDRESS: STREET 1: P.O. BOX 49088 STREET 2: SUITE 800 -- 1055 DUNSMUIR STREET CITY: VANCOUVER STATE: A1 ZIP: V7X 1G4 BUSINESS PHONE: 604-689-3846 MAIL ADDRESS: STREET 1: P.O. BOX 49088 STREET 2: SUITE 800 -- 1055 DUNSMUIR STREET CITY: VANCOUVER STATE: A1 ZIP: V7X 1G4 FORMER COMPANY: FORMER CONFORMED NAME: SILVER STANDARD RESOURCES INC DATE OF NAME CHANGE: 19950714 6-K 1 a2018q1form6-k.htm 6-K Document


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For May 10, 2018
Commission File Number: 000-26424
SSR MINING INC.
(Translation of registrant's name into English)

#800 - 1055 Dunsmuir Street
PO Box 49088, Bentall Postal Station
Vancouver, British Columbia
Canada V7X 1G4
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

[ ] Form 20-F   [x] Form 40-F

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): [      ]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): [           ]

INCORPORATION BY REFERENCE

Exhibits 99.1 and 99.2 hereto are each hereby incorporated by reference into the registration statements on Form S-8 (File No. 333-185498, 333-196116 and 333-198092) of SSR Mining Inc.

DOCUMENTS FILED AS PART OF THIS FORM 6-K

See the Exhibit Index hereto.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 
SSR Mining Inc.
 
(Registrant)
 
 
 
Date: May 10, 2018
By:
Signed: “Gregory J. Martin
 
 
Gregory J. Martin
 
Title:
Chief Financial Officer








ssrmininglogonewa01.jpg

SUBMITTED HEREWITH

Exhibits





EX-99.1 2 a2018q1fs.htm EXHIBIT 99.1 Exhibit

ssrmininglogonew.jpg








CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED MARCH 31, 2018 AND 2017
(unaudited)








Contents




 
Financial Statements
 
 
 
 
 
 
 
 
 
 
Notes to the Condensed Consolidated Interim Financial Statements
 
 
 
 
 
Statements of Financial Position
 
 
 
 
 
Statements of (Loss) Income
 
 
 
 
 
Statements of Shareholders’ Equity
 
 
 
 
Additional Disclosures
 
 
 



SSR Mining Inc.
Interim Financial Statements Q1 2018 | 2



Condensed Consolidated Interim Statements of Financial Position
SSR Mining Inc.
(expressed in thousands of United States dollars)


 
Note
March 31

December 31

 
 
2018

2017

 
 

$

Current assets
 
 
 
Cash and cash equivalents
 
472,901

459,864

Trade and other receivables
 
33,841

38,052

Marketable securities
 
43,840

114,001

Inventory
3
204,198

182,581

Other
 
3,899

5,099

 
 
758,679

799,597

Non-current assets
 
 
 
Property, plant and equipment
 
651,769

658,629

Goodwill
 
49,786

49,786

Other
 
29,889

29,442

Total assets
 
1,490,123

1,537,454

 
 
 
 
Current liabilities
 
 
 
Trade and other payables
 
62,365

60,153

Provisions
4
10,583

11,313

 
 
72,948

71,466

Non-current liabilities
 
 
 
Deferred income tax liabilities
 
106,093

114,576

Provisions
4
89,071

94,304

Debt
 
236,685

233,180

Total liabilities
 
504,797

513,526

 
 
 
 
Shareholders' equity
 
 
 
Share capital
 
1,047,938

1,047,233

Other reserves
 
(13,442
)
24,998

Equity component of convertible notes
 
68,347

68,347

Deficit
 
(141,319
)
(139,693
)
Total equity attributable to SSR Mining shareholders
 
961,524

1,000,885

Non-controlling interest
 
23,802

23,043

Total equity
 
985,326

1,023,928

Total liabilities and equity
 
1,490,123

1,537,454

 
 
 
 
Events after the reporting date (Note 10)
 
 
 
The accompanying notes are an integral part of the condensed consolidated interim financial statements

Approved by the Board of Directors and authorized for issue on May 10, 2018
"Richard D. Paterson"
 
"Paul Benson"
Richard D. Paterson, Director
 
Paul Benson, Director

SSR Mining Inc.
Interim Financial Statements Q1 2018 | 3



Condensed Consolidated Interim Statements of (Loss) Income
SSR Mining Inc.
(expressed in thousands of United States dollars, except for per share amounts)



 
Note
Three months ended March 31,
 
 
 
2018

2017

 
 
$

$

Revenue
97,902

117,905

Cost of sales
8
(80,671
)
(77,816
)
Income from mine operations
 
17,231

40,089

 
 
 
 
General and administrative expenses
 
(6,669
)
(7,890
)
Exploration, evaluation and reclamation expenses
 
(2,831
)
(7,390
)
Operating income
 
7,731

24,809

 
 
 
 
Interest earned and other finance income
 
2,304

1,027

Interest expense and other finance costs
 
(8,836
)
(6,646
)
Other expenses
 
(3,947
)
(1,283
)
Foreign exchange gain
 
1,942

560

(Loss) income before income tax
 
(806
)
18,467

Income tax expense
 
(1,516
)
(3,420
)
Net (loss) income

(2,322
)
15,047

Attributable to:
 
 
 
Equity holders of SSR Mining
 
(1,626
)
15,047

Non-controlling interests
 
(696
)

 
 
 
 
Net (loss) income per share attributable to equity holders of SSR Mining
 
 
Basic
6
$(0.01)
$0.13
Diluted
6
$(0.01)
$0.12
The accompanying notes are an integral part of the condensed consolidated interim financial statements


SSR Mining Inc.
Interim Financial Statements Q1 2018 | 4



Condensed Consolidated Interim Statements of Comprehensive (Loss) Income
SSR Mining Inc.
(expressed in thousands of United States dollars)



 
 
Three months ended March 31,
 
 
 
2018

2017

 
 
$

$

Net (loss) income

(2,322
)
15,047

Other comprehensive (loss) income
 
 
 
Items that will not be reclassified to net income:
 
 
 
(Loss) gain on marketable securities at FVTOCI, net of tax $5,532 and ($5,039)
 
(38,327
)
35,646

Items that may be subsequently reclassified to net income:
 
 
 
Unrealized (loss) on effective portion of derivative, net of tax $146 and $63
 
(337
)
(115
)
Total other comprehensive (loss) income
 
(38,664
)
35,531

Total comprehensive (loss) income
 
(40,986
)
50,578

Attributable to:
 
 
 
Equity holders of SSR Mining
 
(40,290
)
50,578

Non-controlling interests
 
(696
)

The accompanying notes are an integral part of the condensed consolidated interim financial statements


SSR Mining Inc.
Interim Financial Statements Q1 2018 | 5



Condensed Consolidated Interim Statements of Changes in Shareholders' Equity
SSR Mining Inc.
(expressed in thousands of United States dollars)



 
Note
Common Shares
Other reserves

Equity component of convertible notes

Deficit

Total equity attributable to equity holders of SSR Mining

Non-controlling interest

Total
equity

 
 
Shares

Amount

 
 
000's

$

$

$

$

$

$

$

Balance, January 1, 2017
 
119,401

1,043,555

(1,014
)
68,347

(209,009
)
901,879


901,879

  Exercise of stock options
 
86

813

(419
)


394


394

Equity-settled share-based compensation
7


586



586


586

Total comprehensive income for the period
 


35,531


15,047

50,578


50,578

Balance, March 31, 2017
 
119,487

1,044,368

34,684

68,347

(193,962
)
953,437


953,437

 
 
 
 
 
 
 
 
 
 
Balance, January 1, 2018
 
119,841

1,047,233

24,998

68,347

(139,693
)
1,000,885

23,043

1,023,928

Exercise of stock options
 
91

705

(244
)


461


461

Equity-settled share-based compensation
7


468



468


468

Funding from non-controlling interest
 






1,455

1,455

Total comprehensive (loss) for the period
 


(38,664
)

(1,626
)
(40,290
)
(696
)
(40,986
)
Balance, March 31, 2018
 
119,932

1,047,938

(13,442
)
68,347

(141,319
)
961,524

23,802

985,326

The accompanying notes are an integral part of the condensed consolidated interim financial statements

SSR Mining Inc.
Interim Financial Statements Q1 2018 | 6



Condensed Consolidated Interim Statements of Cash Flows
SSR Mining Inc.
(expressed in thousands of United States dollars)



 
Note
Three months ended March 31,
 
 
 
2018

2017

 
 
$

$

Cash flows from operating activities
 
 
 
Net (loss) income for the period
 
(2,322
)
15,047

Adjustments for:
 
 
 
Depreciation, depletion and amortization
 
25,400

24,018

Net finance expense
 
6,072

5,319

Income tax expense
 
1,516

3,420

Non-cash foreign exchange gain
 
(2,253
)
(588
)
Net changes in non-cash working capital items
10
(11,868
)
(11,339
)
Other items impacting operating activities
10
4,323

2,006

Cash generated by operating activities before interest and taxes
 
20,868

37,883

Moratorium paid
 
(1,820
)
(3,431
)
Interest paid
 
(5,822
)
(3,809
)
Income taxes paid
 
(2,219
)

Cash generated by operating activities
 
11,007

30,643

Cash flows from and used in investing activities
 
 
 
Purchase of plant and equipment
 
(8,775
)
(8,743
)
Capitalized stripping costs
 
(2,902
)
(6,745
)
Underground mine development costs
 
(2,283
)
(2,514
)
Chinchillas project costs
 
(11,715
)

Capitalized exploration costs
 
(2,222
)
(1,112
)
Net proceeds from sale of marketable securities
 
28,063


Interest received
 
1,643

696

Other
 
(422
)
300

Cash generated by (used in) investing activities
 
1,387

(18,118
)
Cash flows from and used in financing activities
 
 
 
Proceeds from exercise of stock options
 
461

335

Funding from non-controlling interests
 
1,455


Cash generated by financing activities
 
1,916

335

Effect of foreign exchange rate changes on cash and cash equivalents
 
(1,273
)
598

Increase in cash and cash equivalents
 
13,037

13,458

Cash and cash equivalents, beginning of period
 
459,864

327,127

Cash and cash equivalents, end of period
 
472,901

340,585

The accompanying notes are an integral part of the condensed consolidated interim financial statements

SSR Mining Inc.
Interim Financial Statements Q1 2018 | 7



Notes to the Condensed Consolidated Interim Financial Statements
SSR Mining Inc.
(tabular amounts expressed in thousands of United States dollars unless otherwise stated)



1.
NATURE OF OPERATIONS

SSR Mining Inc. ("we", "us", "our" or "SSR Mining") is a company incorporated under the laws of the Province of British Columbia, Canada and our shares are publicly listed on the Toronto Stock Exchange in Canada and the NASDAQ Global Market in the United States. Together with our subsidiaries, we (the “Group”) are principally engaged in the operation, acquisition, exploration and development of precious metal resource properties located in the Americas. We have three producing mines and a portfolio of precious metal dominant projects located throughout the Americas. SSR Mining Inc. is the ultimate parent of the Group.

Our address is Suite 800, 1055 Dunsmuir Street, PO Box 49088, Vancouver, British Columbia, V7X 1G4.

Our focus is on safe, profitable gold and silver production from our Marigold mine in Nevada, U.S., Seabee Gold Operation in Saskatchewan, Canada and our 75% owned Puna Operations in Jujuy, Argentina, and to advance, as market and project conditions permit, our other principal development projects towards development and commercial production.


2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies applied in the preparation of these condensed consolidated interim financial statements are set out below.

a)
Basis of preparation
These condensed consolidated interim financial statements should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2017.

These condensed consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") applicable to the preparation of interim financial statements, including IAS 34, Interim Financial Reporting, and do not include all the information required for full annual financial statements. The comparative information has also been prepared on this basis.

These statements were authorized for issue by our Board of Directors on May 10, 2018.

b)
Change in accounting policies
We have adopted the requirements of IFRS 15 Revenue from Contracts with Customers (“IFRS 15”) as of January 1, 2018. IFRS 15 covers principles that an entity shall apply to report useful information to users of financial statements about the nature, amount, timing, and uncertainty of revenue and cash flows arising from a contract with a customer. We elected to apply IFRS 15 using a modified retrospective approach by recognizing the cumulative effect of initially adopting IFRS 15 as an adjustment to the opening balance sheet at January 1, 2018. Therefore, the comparative information has not been restated and continues to be reported under IAS 18 Revenue ("IAS18"). The details of accounting policy changes and the quantitative impact of these changes are described below.

Gold doré and bullion sales

IFRS 15 requires that revenue from contracts with customers be recognized upon the transfer of control over goods or services to the customer. The recognition of revenue upon transfer of control to the customer is consistent with our revenue recognition policy as set out in Note 2(f) to our 2017 Consolidated Financial Statements, as the condition is satisfied on gold doré and bullion sales when title transfers to the customer. Accordingly, upon adoption, this requirement under IFRS 15 resulted in no impact to our financial statements, as the timing of revenue recognition on our gold bullion sales is unchanged.


SSR Mining Inc.
Interim Financial Statements Q1 2018 | 8



Notes to the Condensed Consolidated Interim Financial Statements
SSR Mining Inc.
(tabular amounts expressed in thousands of United States dollars unless otherwise stated)


2.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Concentrate sales

We performed an assessment of our existing concentrate sales agreements and determined that there is no change in the timing of revenue recognition under IFRS 15. The point of transfer of risks and rewards and transfer of control for concentrate sales occur at the same time. IFRS 15 identifies that the shipping component associated with certain concentrate sales may be a separate performance obligation, which would require a portion of the revenue to be deferred and recognized as the obligation is fulfilled. We have determined that the deferred revenue would be insignificant and thus, have not accounted for the shipping component as a separate performance obligation.

IFRS 15 does not consider changes in the fair value of the concentrate receivable measured at fair value through profit and loss (“FVTPL”) as revenue from contracts with customers. Accordingly, we have separately presented the changes as other revenue in Note 5.

c)
Significant accounting judgments and estimates
The preparation of financial statements requires the use of assumptions, judgments and/or estimates that affect the amounts reported and disclosed in the consolidated financial statements and related notes. These assumptions, judgments and estimates are based on management’s best knowledge of the relevant facts and circumstances, having regard to previous experience, but actual results may differ materially from the amounts included in the financial statements. The significant judgments and estimates applied in the preparation of the unaudited condensed consolidated interim financial statements for the three months ended March 31, 2018 are consistent with those applied and disclosed in Note 2(u) to our 2017 Consolidated Financial Statements.


3.
INVENTORY
 
March 31, 2018

December 31, 2017

 

$

Current:
 
 
Finished goods
19,184

19,262

Stockpiled ore
6,510

6,806

Leach pad inventory
141,508

128,783

Materials and supplies
36,996

27,730

 
204,198

182,581

Non-current materials and supplies
4,191

3,973

 
208,389

186,554


As at March 31, 2018, we have total provisions of $7,166,000 (December 31, 2017 - $7,250,000) for supplies inventory that we no longer expect to utilize.



SSR Mining Inc.
Interim Financial Statements Q1 2018 | 9



Notes to the Condensed Consolidated Interim Financial Statements
SSR Mining Inc.
(tabular amounts expressed in thousands of United States dollars unless otherwise stated)


4.
PROVISIONS
 
March 31, 2018
 
December 31, 2017
 
 
Current

Non-current

Current

Non-current

 
$

$

$

$

Moratorium (1)
8,735

32,268

9,085

36,952

Close down and restoration provision
691

56,803

978

57,352

Other provisions
1,157


1,250


 
10,583

89,071

11,313

94,304


(1) 
We entered into a fiscal stability agreement with the Federal Government of Argentina in 1998 for production from the Puna Operations. In December 2007, the National Customs Authority of Argentina (Dirección Nacional de Aduanas) ("Customs") levied an export duty of approximately 10% from concentrate for projects with fiscal stability agreements pre-dating 2002 and Customs had asserted that the Puna Operations was subject to this duty. We had previously challenged the legality of the export duty applied to silver concentrate.

On March 31, 2017, we entered into the tax moratorium system in Argentina to resolve the export duty dispute. Under the conditions of the moratorium, which converted the export duty liability to Argentine pesos ("ARS"), we agreed to pay ARS 1,057,444,000 ($68,621,000 undiscounted) with a 5% down payment initially and the balance in installments over 60 months. Outstanding ARS amounts are subject to interest at a minimum rate of 1.5% per month.

With our entry into the tax moratorium for resolution of our export duty dispute, we are no longer challenging the legality of the application of the export duty other than with respect to our right for reimbursement of the $6,646,000 of export duty that we paid.


5.
REVENUE

 
Three months ended March 31,
 
 
2018

2017

Gold doré and bullion sales
82,669

91,371

Concentrate sales
16,153

21,592

Other revenue
(920
)
4,942

 
97,902

117,905



SSR Mining Inc.
Interim Financial Statements Q1 2018 | 10



Notes to the Condensed Consolidated Interim Financial Statements
SSR Mining Inc.
(tabular amounts expressed in thousands of United States dollars unless otherwise stated)


6.
(LOSS) INCOME PER SHARE

The calculations of basic and diluted (loss) income per share are based on the following:
 
Three months ended March 31,
 
 
2018

2017

Net (loss) income
(2,322
)
15,047

Net (loss) income attributable to non-controlling interests
(696
)

Net (loss) income used in the calculation of diluted net (loss) income per share
(1,626
)
15,047

 
 
 
Weighted average number of common shares issued (thousands)
119,882
119,425
Adjustments for dilutive instruments:
 
 
Stock options (thousands)

1,364
Weighted average number of common shares for diluted income per share (thousands)
119,882
120,789
 
 
 
Basic net (loss) income per share attributable to equity holders of SSR Mining
$(0.01)
$0.13
Diluted net (loss) income per share attributable to equity holders of SSR Mining
$(0.01)
$0.12


7.
SHARE-BASED COMPENSATION

Total share-based compensation, including all equity and cash-settled arrangements, for the three months ended March 31, 2018 and 2017 has been recognized in the condensed consolidated interim financial statements as follows:
 
Three months ended March 31,
 
 
2018

2017

 
$

$

Equity-settled


Cost of inventory
54

32

General and administrative expenses
403

544

Exploration, evaluation and reclamation expenses
11

10

Cash-settled


Cost of inventory
293

300

General and administrative expenses
2,468

3,384

Exploration, evaluation and reclamation expenses
24

55

 
3,253

4,325



SSR Mining Inc.
Interim Financial Statements Q1 2018 | 11



Notes to the Condensed Consolidated Interim Financial Statements
SSR Mining Inc.
(tabular amounts expressed in thousands of United States dollars unless otherwise stated)


8.
OPERATING SEGMENTS

The following is a summary of the reported amounts of income or loss, and the carrying amounts of assets and liabilities by operating segment:
Three months ended March 31, 2018
Marigold mine

Seabee Gold Operation

Puna Operations (i)

Exploration and evaluation properties

Other reconciling items (ii)

Total

 


$

$

$

$

Revenue
55,880

26,789

15,233



97,902

Cost of inventory
(30,196
)
(9,604
)
(15,933
)


(55,733
)
Depletion, depreciation and amortization
(13,372
)
(10,513
)
(1,053
)


(24,938
)
Income (loss) from mine operations
12,312

6,672

(1,753
)


17,231

 
 
 
 
 
 
 
Exploration, evaluation and reclamation expenses
(101
)
(1,814
)
(70
)
(641
)
(205
)
(2,831
)
Operating income (loss)
11,053

4,321

(2,561
)
(641
)
(4,441
)
7,731

Income (loss) before income tax
6,822

1,815

(3,982
)
(552
)
(4,909
)
(806
)
 
 
 
 
 
 
 
As at March 31, 2018
 
 
 
 
 
 
Total assets
443,941

432,902

134,185

72,599

406,496

1,490,123

Non-current assets
215,062

338,642

78,145

68,900

12,462

713,211

Total liabilities
(72,357
)
(94,929
)
(75,922
)
(6,541
)
(255,048
)
(504,797
)

Three months ended March 31, 2017
Marigold mine

Seabee Gold Operation

Puna Operations (i)

Exploration and evaluation properties

Other reconciling items (ii)

Total

 
$

$

$

$

$

$

Revenue
63,762

27,609

26,534



117,905

Cost of inventory
(30,699
)
(12,839
)
(14,247
)


(57,785
)
Depletion, depreciation and amortization
(11,736
)
(9,775
)
(2,426
)


(23,937
)
Export duty


4,303



4,303

Restructuring costs


(397
)


(397
)
Income from mine operations
21,327

4,995

13,767



40,089

 
 
 
 
 
 
 
Exploration, evaluation and reclamation expenses
(287
)
(1,612
)
(3,578
)
(1,641
)
(272
)
(7,390
)
Operating income (loss)
21,040

3,384

10,014

(1,916
)
(7,713
)
24,809

Income (loss) before income tax
21,019

3,354

8,083

(5,219
)
(8,770
)
18,467

 
 
 
 
 
 
 
As at December 31, 2017
 
 
 
 
 
 
Total assets
436,815

418,210

200,590

72,825

409,014

1,537,454

Non-current assets
222,800

346,647

77,112

71,782

798

719,139

Total liabilities
(73,526
)
(92,050
)
(77,850
)
(6,496
)
(263,604
)
(513,526
)

(i) Following the formation of the joint venture with Golden Arrow on May 31, 2017, the Pirquitas property was combined with the Chinchillas project into the Puna Operations operating segment. We fully consolidated Puna Operations, which includes non-controlling interest portion of revenues, and (loss) from mine operations for the three months ended March 31, 2018 of $3,715,000 and $(420,000), respectively, (March 31, 2017: $nil and $nil).

(ii) Other reconciling items refer to items that are not reported as part of segment performance as they are managed on a corporate basis.

SSR Mining Inc.
Interim Financial Statements Q1 2018 | 12



Notes to the Condensed Consolidated Interim Financial Statements
SSR Mining Inc.
(tabular amounts expressed in thousands of United States dollars unless otherwise stated)


9.
FAIR VALUE MEASUREMENTS

Assets and liabilities that are held at fair value are categorized based on a valuation hierarchy as follows:
 
Fair value at March 31, 2018
Fair value at December 31, 2017
 
Level 1

Level 2

Level 3

Total

Level 1

Level 2

Level 3

Total

 

$

$

$


$

$

$

Recurring measurements
 
 
 
 
 
 
 
 
Trade receivables

9,839


9,839


14,848


14,848

Marketable securities
43,840



43,840

114,001



114,001

Derivative assets

746


746


1,287


1,287

Other financial assets


4,970

4,970



6,338

6,338

Accrued liabilities

(12,282
)

(12,282
)

(10,009
)

(10,009
)
 
43,840

(1,697
)
4,970

47,113

114,001

6,126

6,338

126,465

 
 
 
 
 
 
 
 
 
Non-recurring measurements
 
 
 
 
 
 
 
 
Deferred consideration






7,399

7,399

 






7,399

7,399

 
 
 
 
 
 
 
 
 
Fair values disclosed
 
 
 
 
 
 
 
 
Convertible notes
(262,233
)


(262,233
)
(259,578
)


(259,578
)
 
(262,233
)


(262,233
)
(259,578
)


(259,578
)

There were no transfers between Level 1 and Level 2 fair value measurements. During the three months ended March 31, 2018, there were no transfers into or out of Level 3 fair value measures.


10.
SUPPLEMENTAL CASH FLOW INFORMATION

Changes in working capital items during the three months ended March 31, 2018 and 2017 are as follows:
 
Three months ended March 31,
 
 
2018

2017

 
$

$

Trade and other receivables
5,581

5,307

Inventory
(18,473
)
(8,647
)
Trade and other payables
1,487

(2,390
)
Provisions
(463
)
(5,609
)
 
(11,868
)
(11,339
)

Subsequent to March 31, 2018, we sold our remaining position in Pretium Resources Inc. realizing pre-tax cash proceeds of $35,381,000.

SSR Mining Inc.
Interim Financial Statements Q1 2018 | 13



Notes to the Condensed Consolidated Interim Financial Statements
SSR Mining Inc.
(tabular amounts expressed in thousands of United States dollars unless otherwise stated)


10.
SUPPLEMENTAL CASH FLOW INFORMATION (Continued)

Adjustments for non-cash other operating activities during the three months ended March 31, 2018 and 2017 are as follows:
 
Three months ended March 31,
 
 
2018

2017

 
$

$

Share-based payments
468

586

Export duty adjustment in cost of sales

(4,303
)
Change in estimate of close down and restoration provision

3,578

Write down of fixed assets
2,749

195

Other
1,106

1,950

 
4,323

2,006



Non-cash investing and financing transactions conducted during the three months ended March 31, 2018 and 2017 are as follows:
 
Three months ended March 31,
 
 
2018

2017

 
$

$

Transfer of share-based payment reserve upon exercise of stock options
(244
)
(419
)
Shares received from sale of mineral properties
1,303

1,000

 
1,059

581





SSR Mining Inc.
Interim Financial Statements Q1 2018 | 14

EX-99.2 3 a2018q1mda.htm EXHIBIT 99.2 Exhibit







ssrmininglogonew.jpg






MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE MONTHS ENDED MARCH 31, 2018







SSR Mining Inc.
MD&A First Quarter 2018 |  2



MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE FINANCIAL POSITION AND RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2018


This Management's Discussion and Analysis ("MD&A") is intended to supplement the unaudited condensed consolidated interim financial statements of SSR Mining Inc., ("we", "us", "our" or "SSR Mining") for the three months ended March 31, 2018, and the related notes thereto, which have been prepared in accordance with International Financial Reporting Standards ("IFRS"), as issued by the International Accounting Standards Board ("IASB"), applicable to the preparation of interim financial statements, including IAS 34, Interim Financial Reporting.

All figures are expressed in U.S. dollars except where otherwise indicated. References to CAD refer to Canadian dollars, and ARS to Argentine pesos. This MD&A has been prepared as of May 10, 2018, and should be read in conjunction with the unaudited condensed consolidated interim financial statements for the three months ended March 31, 2018.

Additional information, including our Annual Information Form and Annual Report on Form 40-F for the year ended December 31, 2017, is available on SEDAR at www.sedar.com, and on the EDGAR section of the U.S. Securities and Exchange Commission ("SEC") website at www.sec.gov.

This MD&A contains "forward-looking statements" that are subject to risk factors set out in a cautionary note contained in section 12 herein. We use certain non-GAAP and additional GAAP financial measures in this MD&A; for a description of each of these measures, please see the discussion under "Non-GAAP and Additional GAAP Financial Measures" in section 9 of this MD&A.


1.FIRST QUARTER 2018 HIGHLIGHTS


Solid financial performance: Produced 78,483 gold equivalent ounces at cash costs of $766 per payable ounce, generating operating cash flow of $11.0 million and adjusted attributable net income of $5.7 million or $0.05 per share.

Record quarterly throughput at the Seabee Gold Operation: Continued to successfully ramp up mill throughput, operating at an average of 1,036 tonnes per day during the quarter.

Low-cost production at the Seabee Gold Operation: Produced 23,717 ounces of gold at cash costs of $481 per payable ounce of gold sold, a record low cash cost since acquiring the operation in 2016.

Production in line with guidance at the Marigold mine: Produced 42,960 ounces of gold at cash costs of $720 per payable ounce of gold sold, and a near-record 7.1 million tonnes of ore stacked.

Solid quarterly performance at Puna Operations: Produced 0.9 million ounces of silver at cash costs of $17.07 per payable ounce of silver sold, as lower grade stockpiles are processed.

Chinchillas project remains on track: Capital expenditures totaled $12 million as the project remains on track for ore delivery in the second half of 2018.

Increased cash position: Quarter-end cash increased to $472.9 million, up $13.0 million from the previous quarter.




SSR Mining Inc.
MD&A First Quarter 2018 |  3



2.
OUTLOOK

This section of the MD&A provides management's production, cost, capital, exploration and development expenditure estimates for 2018. These are “forward-looking statements” and subject to the cautionary note regarding the risks associated with forward-looking statements contained in Section 12. Cash costs per payable ounce of gold and silver sold are non-GAAP financial measures. Please see the discussion under "Non-GAAP and Additional GAAP Financial Measures" in Section 9.
Our guidance is unchanged from that reported on January 15, 2018. For the full year 2018, we expect:
Operating Guidance
 
Marigold mine

Seabee Gold Operation

Puna Operations (75% interest)(4)

Gold Production
oz
190,000 - 210,000

85,000 - 92,000


Silver Production
Moz


3.0 - 4.4

Silver Production (attributable)
Moz


2.3 - 3.3

Lead Production
Mlb


7.0 - 12.5

Lead Production (attributable)
Mlb


5.3 - 9.4

Zinc Production
Mlb


5.5 - 7.5

Zinc Production (attributable)
Mlb


4.1 - 5.6

Cash Cost per Payable Ounce Sold (1)
$/oz
725 - 775

560 - 610

12.5 - 15.00

Sustaining Capital Expenditures (2)
$M
35

10

10

Capitalized Stripping / Capitalized Development
$M
15

9

10

Exploration Expenditures (3)
$M
9

9

1


(1) 
We report the non-GAAP financial measure of cash costs per payable ounce of gold and silver sold to manage and evaluate operating performance at the Marigold mine, the Seabee Gold Operation and Puna Operations. See “Non-GAAP and Additional GAAP Financial Measures” in Section 9.
(2) 
Sustaining capital expenditures for the Marigold mine exclude $22 million for four additional haul trucks as announced in our news release dated February 22, 2018, and for Puna Operations exclude initial capital expenditures related to the development of the Chinchillas project.
(3) 
Includes capitalized and expensed exploration expenditures.
(4) 
Shown on a 100% basis unless otherwise indicated.

On a consolidated basis, at the mid-point of guidance, we expect to produce 340,000 gold equivalent ounces in 2018 at gold equivalent cash costs of between $715 and $770 per payable ounce of gold sold. On an attributable basis, we expect to produce 325,000 gold equivalent ounces in 2018 at gold equivalent cash costs of between $705 and $760 per payable ounce of gold sold.

Gold equivalent figures for our 2018 operating guidance are based on gold-to-silver ratio of 73:1. Cash costs and capital expenditures guidance is based on an oil price of $60 per barrel and exchange rate of 1.25 CAD to U.S. dollar.

We expect to file a NI 43-101 technical report for the Marigold mine by the third quarter of 2018. The technical report will include the 2017 Mineral Reserves contained within the life of mine pit design and reflect added hauling capacity provided by the trucking fleet additions for expected annual gold production of over 250,000 ounces in 2022.

SSR Mining Inc.
MD&A First Quarter 2018 |  4



3.
BUSINESS OVERVIEW

Strategy

We are a resource company focused on the operation, acquisition, exploration and development of precious metal resource properties located in the Americas. We have three producing mines and a portfolio of precious metal dominant projects located throughout the Americas. Our focus is on safe, profitable gold and silver production from our Marigold mine in Nevada, U.S., our Seabee Gold Operation in Saskatchewan, Canada, and our 75% owned Puna Operations in Jujuy, Argentina.

Corporate summary

SSR Mining has an experienced management team of mine-builders and operators with proven capabilities. We have an enviable balance sheet with $472.9 million in cash and cash equivalents and $43.8 million in marketable securities as at March 31, 2018. We are committed to delivering safe production through relentless emphasis on Operational Excellence. We are also focused on growing production and Mineral Reserves through the exploration and acquisition of assets for accretive growth, while maintaining financial strength.

On January 1, 2018, we appointed Ms. Elizabeth A. Wademan and Mr. Simon A. Fish, to our Board of Directors with the objective to strengthen the Board's expertise in the areas of international capital markets and legal and corporate governance. On May 3, 2018, we announced the appointment of Kevin O'Kane as Chief Operating Officer effective June 4, 2018.

In the first quarter of 2018, we sold 4.0 million common shares of Pretium Resources Inc. ("Pretium"), realizing pre-tax cash proceeds of $28.1 million. At March 31, 2018, we held 5.0 million common shares, representing approximately 2.8% of Pretium. Subsequent to the quarter end, we sold our remaining position in Pretium for pre-tax proceeds of approximately $35 million.

Market overview

Metal prices

Precious metals prices are an important driver of our profitability. In the first quarter of 2018 the average gold price was higher by 4% and the average silver price remained at a comparable level with the fourth quarter of 2017, with gold averaging $1,330 per ounce and silver averaging $16.77 per ounce. Gold price closed at $1,324 per ounce and silver at $16.28 per ounce on March 31, 2018.

The principal factors impacting precious metals prices in the first quarter were the uncertainty of future movement of the U.S. interest rates and expectations of rising inflation. Additionally, there is uncertainty resulting from high geopolitical risk and trade protectionism.


SSR Mining Inc.
MD&A First Quarter 2018 |  5



Currency and commodity markets

The CAD remained at levels comparable with the end of the fourth quarter of 2017. During the first quarter, the CAD averaged approximately 1.26 CAD per 1 USD and closed at 1.29 CAD per 1 USD on March 31, 2018. Our exposure to the CAD is significant due to our Seabee Gold Operation and we have continued our risk management hedging program to protect a portion of its CAD operating costs through 2018.

The ARS weakened by 8% in the first quarter of 2018, closing at 20.15 ARS against 1 USD on March 31, 2018. While a weaker currency is positive for our Argentine operating costs, we expect the high inflation rates in Argentina to somewhat offset the benefits of the devaluation of the currency. The weakening ARS also has a positive impact on our outstanding moratorium liability which is denominated in ARS, but such positive impact is partially offset by the negative impact it has on our value added tax receivable balances. Subsequently in early May 2018, the ARS devalued by 15%, closing at approximately 23.0, and we continue to monitor this for any implication on our operations.

West Texas Intermediate oil prices were 14% higher in the first quarter of 2018 than in the fourth quarter of 2017, with an average of $62.93 per barrel and closing at $64.94 per barrel. Diesel, a product of oil, is a significant consumable at our operations and the movement in diesel prices can have a significant impact on the cost structure at all of our mines. We hedge a portion of our diesel usage to manage price risk of this consumable through 2019.

Consolidated financial summary
(presented in thousands of USD, except for per share value)
Selected Financial Data (1)
 
 
 
 
 
 
                 Three months ended March 31,
 
 
2018


2017

 
 
$


$

Revenue
 
97,902

 
117,905

Income from mine operations (1)
 
17,231

 
40,089

Gross margin (%)
 
18
 
34

Operating income (1)
 
7,731

 
24,809

Net (loss) income
 
(2,322
)
 
15,047

Basic attributable (loss) income per share
 
(0.01
)
 
0.13

Adjusted attributable income before tax (1)
 
6,736

 
23,161

Adjusted attributable net income (1)
 
5,662

 
19,741

Adjusted basic attributable income per share (1)
 
0.05

 
0.17

Cash generated by operating activities
 
11,007

 
30,643

Cash generated by (used in) investing activities
 
1,387

 
(18,118
)
Cash generated by financing activities
 
1,916

 
335

 
 
 
 
 
Financial Position
 
March 31, 2018

 
December 31, 2017

Cash and cash equivalents
 
472,901

 
459,864

Marketable securities
 
43,840

 
114,001

Current assets
 
758,679

 
799,597

Current liabilities
 
72,948

 
71,466

Working capital
 
685,731

 
728,131

Total assets
 
1,490,123

 
1,537,454

(1) 
We report non-GAAP and Additional GAAP financial measures including income from mine operations, gross margin, operating income, adjusted attributable income before tax, adjusted attributable net income, adjusted basic attributable income per share, to manage and evaluate our operating performance. See "Non-GAAP and Additional GAAP Financial Measures" in Section 9.


SSR Mining Inc.
MD&A First Quarter 2018 |  6



Quarterly financial summary

Revenue in the first quarter of 2018 decreased by 17% relative to the comparative quarter of 2017 due principally to the expected declines in sales at Puna Operations, as it processed lower grade stockpiles, and at the Marigold mine, due to planned production and leach cycles.

Income from mine operations in the first quarter of 2018 generated a gross margin of 18%, lower than the 34% margin in the first quarter of 2017. In the first quarter of 2018, cost of sales at Puna Operations were elevated as we processed lower grade stockpiles, and also higher cost of sales were experienced at the Marigold mine as we have been processing higher cost material stacked in the second half of 2017. In addition, the elevated margin in the first quarter of 2017 benefited from a $4.3 million reduction to cost of sales following the resolution of our export duty claim in Argentina.

Cash generated by operating activities in the quarter was $11.0 million compared to $30.6 million in the first quarter of 2017. Higher production and lower unit costs at the Seabee Gold Operation was more than offset by lower production at the Marigold mine and Puna Operations, resulting in lower volumes of gold and silver sold at higher unit costs, which generated lower cash from operating activities. We also saw an increase in inventory at the Seabee Gold Operation and Marigold which impacted operating cash flows in the current period, and we paid tax installments of $2.2 million which were not incurred in the same period in 2017. We generated $1.4 million from investing activities in the first quarter of 2018 compared to a use of $18.1 million in the first quarter of 2017. In the first quarter of 2018, we received $28.1 million from the sale of common shares of Pretium which was partially offset by investing $8.8 million in property, plant and equipment, and $11.7 million in the Chinchillas project. We received $1.5 million from our joint venture partner for its share of the development costs of the Chinchillas project. Our working capital position decreased to $685.7 million, which was a decrease of $42.4 million from $728.1 million at December 31, 2017, mainly due to the reduction in value of our marketable securities. As a result, cash and cash equivalents increased to $472.9 million during the quarter.


SSR Mining Inc.
MD&A First Quarter 2018 |  7



4.
RESULTS OF OPERATIONS

Consolidated results of operations

The following table presents consolidated operating information for our Marigold mine, our Seabee Gold Operation and our 75% interest in Puna Operations, which comprises the Pirquitas and the Chinchillas properties. Additional operating information is provided in the sections relating to the individual mines.
 
 Three months ended
Operating data
March 31
2018

December 31
2017

September 30
2017

June 30
2017

March 31
2017

Consolidated production and sales:
 
 
 
 
 
Gold produced (oz)
66,677

76,995

56,757

76,248

76,238

Silver produced ('000 oz)
938

1,169

1,541

1,947

1,520

Silver produced (attributable) ('000 oz) (1)
704

877

1,156

1,777

1,520

 
 
 
 
 
 
Gold sold (oz)
62,090

75,389

60,616

75,335

74,939

Silver sold ('000 oz)
1,064

820

2,076

1,655

1,443

Silver sold (attributable) ('000 oz) (1)
798

615

1,557

1,473

1,443

 
 
 
 
 
 
Cash costs ($/oz) - payable gold from Marigold mine (2)
720

699

684

632

585

Cash costs ($/oz) - payable gold from Seabee Gold Operation (2)
481

605

634
592

574

Cash costs ($/oz) - payable silver from Puna Operations (2)
17.07

16.36

12.76

12.15

12.68

 
 
 
 
 
 
Gold equivalent production (oz) (3)
78,483

92,594

77,105

102,933

97,854

Gold equivalent production (attributable) (oz) (3)
75,538

88,698

72,022

100,603

97,854

 
 
 
 
 
 
Realized gold price ($/oz) (2)
1,334

1,271

1,270

1,263

1,220

Realized silver price ($/oz) (2)
16.79

16.96

16.77

17.31

17.35

 
 
 
 
 
 
Consolidated costs:
 
 
 
 
 
Cash costs per equivalent gold ounce sold ($/oz) (2,3)
766

737

757

682

646

AISC per equivalent gold ounce sold ($/oz) (2,3)
1,115

1,008

1,024

889

978

 
 
 
 
 
 
 Financial data ($000s)
 
 
 
 
 
Revenue
97,902

107,881

106,005

116,982

117,905

Income from mine operations
17,231

21,190

22,522

29,462

40,089


(1) 
Figures for the second quarter of 2017 for attributable production and sales represent Puna Operations at 100% for April and May and 75% for June 2017. Figures for all subsequent quarters for attributable production and sales represent Puna Operations at 75%.
(2) 
We report the non-GAAP and Additional GAAP financial measures of cash costs, realized metal prices and all-in sustaining costs ("AISC") per payable ounce of precious metals sold to manage and evaluate operating performance at our mines. For a better understanding and a reconciliation of these measures to cost of sales, as shown in our consolidated statements of comprehensive (loss) income, please refer to “Non-GAAP and Additional GAAP Financial Measures” in Section 9.
(3) 
Gold equivalent ounces have been established using the realized gold and silver prices in the period and applied to the recovered silver metal content produced by the mine.



SSR Mining Inc.
MD&A First Quarter 2018 |  8



Marigold mine, U.S.
 
 Three months ended
 Operating data
March 31
2018

December 31
2017

September 30
2017

June 30
2017

March 31
2017

Total material mined (kt)
16,150

13,979

20,311

17,985

16,736

Waste removed (kt)
9,052

8,136

13,149

11,075

11,062

Total ore stacked (kt)
7,099

5,843

7,162

6,910

5,674

Strip ratio
1.3

1.4

1.8

1.6

1.9

Mining cost ($/t mined)
1.80

1.98

1.52

1.67

1.65

Gold stacked grade (g/t)
0.37

0.37

0.31

0.31

0.42

Processing cost ($/t processed)
0.93

1.08

0.89

0.82

0.89

Gold recovery (%)
74.0

74.0

72.0

73.0

74.0

General and admin costs ($/t processed)
0.42

0.51

0.40

0.42

0.52

 
 
 
 
 
 
Gold produced (oz)
42,960

52,768

38,699

55,558

55,215

Gold sold (oz)
42,078

51,420

38,818

57,426

52,528

 
 
 
 
 
 
Realized gold price ($/oz) (1)
1,331

1,269

1,270

1,265

1,214

 
 
 
 
 
 
Cash costs ($/oz) (1)
720

699

684

632

585

AISC ($/oz) (1)
954

1,001

979

833

799

 
 
 
 
 
 
Financial data ($000s)
 
 
 
 
 
Revenue
55,880

65,217

49,395

72,451

63,762

Income from mine operations
12,312

12,777

11,189

21,373

21,327

Capital expenditures
4,665

8,194

3,855

5,272

3,043

Capitalized stripping
2,902

5,712

6,056

4,350

6,745

Exploration expenditures (2)
1,914

1,208

1,130

1,538

1,024


(1) 
We report the non-GAAP financial measures of realized gold prices, cash costs and AISC per payable ounce of gold sold to manage and evaluate operating performance at the Marigold mine. For a better understanding and a reconciliation of these measures to cost of sales, as shown in our consolidated statements of (loss) income, please refer to “Non-GAAP and Additional GAAP Financial Measures” in Section 9.
(2) 
Includes capitalized and expensed exploration expenditures.

Mine production

In the first quarter of 2018, the Marigold mine produced 42,960 ounces of gold, in line with guidance. Production was 19% less than the previous quarter, due to lower ore stacked in the fourth quarter of 2017.

During the quarter, 16.2 million tonnes of material were mined, 16% more than the fourth quarter of 2017, reflecting an increase in operating days for the quarter due to a resumption of normal mining activities. We expect quarterly material movement to increase in the second quarter of 2018, and further in the second half of the year as four additional haul trucks are added to the fleet. Approximately 7.1 million tonnes of ore were delivered to the heap leach pads at an average gold grade of 0.37 g/t in the quarter. This compares to 5.8 million tonnes of ore delivered to the heap leach pads at a gold grade of 0.37 g/t in the fourth quarter of 2017. The strip ratio was 1.3:1 for the quarter, a 7% decrease compared to the previous quarter.












SSR Mining Inc.
MD&A First Quarter 2018 |  9



Mine operating costs

Cash costs and AISC per payable ounce of gold sold are non-GAAP financial measures. Please see the discussion under "Non-GAAP and Additional GAAP Financial Measures" in section 9.

Cash costs, which include all costs of inventory, refining costs and royalties, of $720 per payable ounce of gold sold in the first quarter of 2018 was 3% higher than the previous quarter. This was primarily due to the cost per ounce of leach pad inventory increasing in the fourth quarter of 2017 resulting from operational impacts, continued lower gold grades and a reduction in deferred stripping. Total mining costs of $1.80 per tonne in the first quarter of 2018 were 9% lower than in the previous quarter due to more tonnes mined for the reasons described above. Processing and general administrative unit costs were 14% and 18% lower, respectively, in the first quarter of 2018 than in the fourth quarter of 2017 due to higher tonnes mined and processed while total costs remained stable.

AISC per payable ounce of gold sold decreased in the first quarter of 2018 to $954 from $1,001 in the fourth quarter due to lower capital expenditures and lower deferred stripping.

Mine sales

A total of 42,078 ounces of gold were sold at an average realized price of $1,331 per ounce during the first quarter of 2018, a decrease of 18% from the 51,420 ounces of gold sold at average realized price of $1,269 per ounce during the fourth quarter of 2017.

Exploration

The main focus of our 2018 exploration program is to conduct infill drilling of the Red Dot resource area and to explore higher grade structural zones within the Mackay Phase 5 pit. During the first quarter, we completed a total of 48 reverse circulation drillholes for 17,170 meters on these targets.

The first series of drillholes targeting higher-grade structures (21 holes, 6,561 meters) at Mackay were collared from within the Phase 5 pit. This drilling has yielded encouraging results, with higher-grade intercepts being returned within and just outside of the current Mineral Reserve pit outline.

Twenty-seven drill holes totaling 10,609 meters were completed during the quarter within the Red Dot area. Drill results have confirmed the current geologic interpretation and are expected to convert Inferred Mineral Resources to Indicated Mineral Resources.

During the second quarter of 2018, we will continue drilling for higher grade structures in Mackay Phase 5 while increasing the number of drill rigs deployed within the Red Dot area to accelerate the exploration program.



SSR Mining Inc.
MD&A First Quarter 2018 |  10



Seabee Gold Operation, Canada

 
Three months ended
Operating data

March 31
2018

December 31
2017

September 30
2017

June 30
2017

March 31
2017

Total ore milled (t)
93,269

89,237

84,315

84,469

72,394

Ore milled per day (t/day)
1,036

970

916

928

804

Gold mill feed grade (g/t)
8.95

8.89

7.03

7.97

9.22

Mining costs ($/t mined)
59

66

74

60

68

Processing costs ($/t processed)
21

24

22

20

23

Gold recovery (%)
97.4

97.4

97.2

97.3

97.7

General and admin costs ($/t processed)
53

61

53

50

59

 
 
 
 
 
 
Gold produced (oz)
23,717

24,227

18,058

20,690

21,023

Gold sold (oz) (1)
20,012

23,969

21,798

17,909

22,411

 
 
 
 
 
 
Realized gold price ($/oz) (2)
1,340

1,276

1,269

1,257

1,233

 
 
 
 
 
 
Cash costs ($/oz) (2)
481

605

634
592

574

AISC ($/oz) (2)
896

776

775

831

990

 
 
 
 
 
 
Financial data ($000s)
 
 
 
 
 
Revenue
26,789

30,571

27,652

22,502

27,609

Income from mine operations
6,672

2,923

3,643

4,083

4,995

Capital expenditures
4,426

920

799

711

4,760

Capitalized development
2,283

2,301

1,314

2,165

2,514

Exploration expenditures (3)
2,032

1,187

1,253

1,566

1,953



(1) 
Beginning with the first quarter of 2018, the holder of the 3% net smelter returns royalty elected to receive its royalty in-kind and we will no longer report these ounces within gold sold.
(2) 
We report the non-GAAP financial measures of realized gold prices, cash costs and AISC per payable ounce of gold sold to manage and evaluate operating performance at the Seabee Gold Operation. For a better understanding and a reconciliation of these measures to cost of sales, as shown in our consolidated statements of (loss) income, please refer to “Non-GAAP and Additional GAAP Financial Measures” in Section 9.
(3) 
Includes capitalized and expensed exploration expenditures.

Mine production

In the first quarter of 2018, Seabee Gold Operation produced 23,717 ounces of gold. With the commissioning of the new gravity circuit at the end of the quarter, in circuit gold inventory increased by approximately 2,400 ounces of gold, which is expected to positively impact gold production through the remainder of 2018.

During the first quarter, total ore milled increased 5% over the previous quarter, with the Santoy mine supplying 73% of ore milled. Following an extensive underground exploration program, ore extraction at the Seabee mine completed during the first quarter and it is currently undergoing decommissioning in advance of closure later this year. Going forward, all ore will be sourced from the Santoy mine.

The mill achieved an average throughput of 1,036 tonnes per day during the quarter, 7% higher than the previous quarter due to a combination of Operational Excellence initiatives at both the mill and the Santoy mine. Gold recovery remained consistent at 97.4%.






SSR Mining Inc.
MD&A First Quarter 2018 |  11



Mine operating costs

Cash costs and AISC per payable ounce of gold sold are non-GAAP financial measures. Please see the discussion under "Non-GAAP and Additional GAAP Financial Measures" in section 9.

Cash costs per payable ounce of gold sold, which include all costs of inventory and refining costs, were $481 in the first quarter of 2018, lower than the $605 in the fourth quarter of 2017. Our record low cash costs per payable ounce sold were primarily the result of higher mill throughput which increased gold production and in circuit inventory while incurring similar total operating costs compared to the prior quarter. Costs per tonne mined were $59 in the first quarter of 2018, 11% lower than in the previous quarter due to higher tonnes mined. Processing and general and administrative unit costs were each lower by 13% in the first quarter of 2018 compared to the fourth quarter of 2017, due to higher tonnes milled. Costs were also positively impacted by a weaker CAD.

AISC per payable ounce of gold sold were $896 in the first quarter of 2018, higher than the $776 in the fourth quarter of 2017. This increase is due to the seasonal nature of our operation whereby annual sustaining capital items are purchased in the first quarter of each year for delivery on the ice road for summer construction. Exploration expenditures increased as planned with a more aggressive drilling campaign due to last year’s exploration success and Fisher property earn-in.

Mine sales

A total of 20,012 ounces were sold at an average realized price of $1,340 per ounce during the first quarter of 2018, 17% lower than the 23,969 ounces of gold sold in the fourth quarter of 2017, at an average realized price of $1,276 per ounce of gold. The reduction in ounces sold is a result of timing of sales recorded.

Exploration

For 2018, the Seabee Gold Operation plans 45,000 meters of underground drilling and 20,000 meters of surface drilling with the objective to increase and convert Mineral Resources into Mineral Reserves near the Santoy mine. In the first quarter of 2018, we completed 10,016 meters of underground drilling and 9,779 meters of surface drilling in 20 and 16 drillholes, respectively.

Our underground drill program for the first quarter of 2018 focused on three targets, including Santoy Gap, Santoy 8A zone and Santoy Gap hanging wall. Surface drilling in the first quarter focused on four areas including Carr, CRJ, Santoy 3 and Fisher with 16 drillholes being completed. Strongly altered rock was encountered at Carr, while drilling at CRJ intersected visible gold in two drillholes. By quarter end two drillholes had been completed at the Fisher property for 1,100 meters of drilling on the extension of the Santoy shear zone, and analytical results are pending.


SSR Mining Inc.
MD&A First Quarter 2018 |  12



Puna Operations, Argentina (75% interest)
(amounts presented on 100% basis unless otherwise stated)
 
Three months ended
Operating data
March 31
2018

December 31
2017

September 30
2017

June 30
2017

March 31
2017

Ore milled (kt)
373

442

461

446

449

Silver mill feed grade (g/t)
115

125

153

185

145

Processing costs ($/t milled)
15.34

13.53

11.92

12.94

13.66

Silver recovery (%)
67.7

66.0

67.8

73.5

72.6

General and admin costs ($/t milled)
6.33

5.74

4.81

5.00

5.22

 
 
 
 
 
 
Silver produced ('000 oz)
938

1,169

1,541

1,947

1,520

Silver produced (attributable) ('000 oz) (1)
704

877

1,156

1,777

1,520

Silver sold ('000 oz)
1,064

820

2,076

1,655

1,443

Silver sold (attributable) ('000 oz) (1)
798

615

1,557

1,473

1,443

 
 
 
 
 
 
Realized silver price ($/oz) (2)
16.79

16.96

16.77

17.31

17.35

 
 
 
 
 
 
Cash costs ($/oz) (2,3)
17.07

16.36

12.76

12.15

12.68

AISC ($/oz) (2,3)
18.37

18.30

13.56

12.78

14.82

 
 
 
 
 
 
Financial Data ($000s)
 
 
 
 
 
Revenue
15,233

12,093

28,958

22,029

26,534

(Loss) income from mine operations
(1,753
)
5,490

7,690

4,006

13,767

Capital expenditures (4)
789

917

1,006

420

2,261

Exploration expenditures (4)
6






(1) 
Attributable production and sales for the second quarter of 2017 represent 100% for April and May and 75% for June 2017. Attributable production and sales for all subsequent quarters represent 75%.
(2) 
We report the non-GAAP financial measures of cash costs per payable ounce of silver sold, realized silver prices and AISC per payable ounce of silver sold to manage and evaluate operating performance at Puna Operations. For a better understanding and a reconciliation of these measures to cost of sales, as shown in our consolidated statements of (loss) income, please refer to “Non-GAAP and Additional GAAP Financial Measures” in Section 9.
(3) 
Cash costs and AISC per payable ounce of silver sold include stockpile inventory costs previously incurred of $5.75 for the three months ended March 31, 2018 (December 31, 2017 - $5.30, September 31, 2017 - $5.20, June 30, 2017 - $3.30, March 31, 2017 - $2.00).
(4) 
Does not include exploration or development of the Chinchillas project.

Mine production

During the first quarter of 2018, the operation produced 0.9 million ounces of silver, in line with expected silver production from stockpiles of 1.6 million ounces in the first half of 2018. Our attributable share of silver production in the first quarter was 0.7 million ounces.

Ore was milled at an average rate of 4,144 tonnes per day in the first quarter, 14% below the previous quarter. Crusher operations in the first quarter were constrained by construction of the crushed ore stockpile dome and wetter than normal weather conditions. Ore milled in the first quarter of 2018 contained an average silver grade of 115 g/t, 8% lower than the 125 g/t reported in the fourth quarter of 2017 as we process increasingly lower grade stockpiles. The average silver recovery in the first quarter was 67.7%, marginally above the previous quarter.

Mine operating costs

Cash costs and AISC per payable ounce of silver sold are non-GAAP financial measures. Please see the discussion under "Non-GAAP and Additional GAAP Financial Measures" in section 9.

Cash costs, which include cost of inventory, treatment and refining costs, provincial royalties and by-product credits, were $17.07 per payable ounce of silver sold in the first quarter of 2018. These cash costs were 4% higher than the $16.36 per payable ounce of silver sold in the fourth quarter of 2017 principally due to lower production resulting from processing lower silver grade stockpiled ore. In the first quarter of 2018, cash costs included approximately $5.75 per payable ounce of stockpile inventory costs that were previously incurred.


SSR Mining Inc.
MD&A First Quarter 2018 |  13



AISC per payable ounce of silver sold in the first of quarter of 2018 were $18.37, comparable to $18.30 in the fourth quarter of 2017.

Mine sales

Silver sales totaled 1.1 million ounces and attributable sales were 0.8 million in the first quarter of 2018, a 30% increase from the fourth quarter of 2017 as we sold down concentrate inventories that had accumulated at year end 2017.

Exploration

During the first quarter of 2018, we began a small 2,400 meter surface drill program at Pirquitas targeting resources that would augment the Cortaderas resource. Three drillholes were completed for 812 meters with positive silver-zinc results from two narrow vein structures.

Chinchillas project, Argentina

Following receipt of development permits in December 2017, pre-stripping and construction activities advanced in the first quarter.

To support pre-strip mining operations, refurbished mine equipment was transferred from Pirquitas to Chinchillas and additional mining equipment within the project scope was delivered to site and commissioned. The operations team initiated its first blast within the Chinchillas pit in March and, during the month, 172,000 tonnes of waste was stripped. Ramp up of pre-stripping is on track for first ore delivery to Pirquitas in the second half of the year.

All major materials and infrastructure have been ordered with deliveries scheduled through to May 2018. In addition, major construction contracts have been awarded with contractors have been mobilized in March 2018 at both Pirquitas, for the in-pit tailings system and stockpile dome, and, at Chinchillas, for earthworks. Concrete foundations for the tailings pumps and electrical room advanced to 75% completion allowing the electromechanical contractor to proceed with installation of the pumps. Pipe installation for the six-kilometer tailings line from the plant to the pit also started during the quarter and is advancing well. The stockpile dome was 25% complete at quarter end.

Earthworks at Chinchillas for infrastructure, buildings and internal access roads advanced to 60% and are on schedule to receive buildings in May 2018. Fabrication of structural steel for the haul truck maintenance facility is in progress. Pre-fabricated buildings for site offices, the dining room and the change house will be delivered and installed in the third quarter. Temporary facilities to support construction and pre-strip works are in place.


5.
REVIEW OF PROJECTS

The SIB exploration project is located near the high-grade, past-producing Eskay Creek mine in northwest British Columbia. During the fourth quarter of 2017, we announced plans to continue with the exploration program committing to a $3.2 million drill program and geophysics activities in 2018. We hold a three-year option to acquire up to a 60% undivided interest in the project and have met the first year spending requirement of $2.9 million. Field work is planned to commence in the second quarter.

SSR Mining Inc.
MD&A First Quarter 2018 |  14



6.
SUMMARIZED FINANCIAL RESULTS

The following table sets out selected financial results for each of the eight most recently completed quarters, expressed in thousands of USD, except per share and per ounce amounts:

 
2018

2017
2016
 
31-Mar

31-Dec

30-Sep

30-Jun

31-Mar

31-Dec

30-Sep

30-Jun

Revenue
97,902

107,881

106,005

116,982

117,905

127,317

143,381

118,775

 
 
 
 
 
 
 
 
 
Gold equivalent payable ounces sold
74,922

85,883

86,930

97,039

94,576

113,308

110,618

90,579

 
 
 
 
 
 
 
 
 
Realized gold price ($/oz) (1)
1,334

1,271

1,270

1,263

1,220

1,243

1,331

1,263

Realized silver price ($/oz) (1)
16.79

16.96

16.77

17.31

17.35

17.14

19.64

16.52

 
 
 
 
 
 
 
 
 
Income from mine operations
17,231

21,190

22,522

29,462

40,089

27,456

59,190

44,062

Net (loss) income before tax
(806
)
13,936

2,175

40,008

18,467

18,606

40,999

15,521

Net (loss) income after tax
(2,322
)
16,850

1,821

37,747

15,047

12,132

38,042

12,482

 
 
 
 
 
 
 
 
 
Basic (loss) earnings per share attributable to our shareholders
(0.01
)
0.14

0.01

0.31

0.13

0.10

0.32

0.13

Diluted (loss) earnings per share attributable to our shareholders
(0.01
)
0.14

0.01

0.31

0.12

0.10

0.31

0.13

 
 
 
 
 
 
 
 
 
Cash and cash equivalents
472,901

459,864

424,025

353,530

340,585

327,127

277,544

232,619

Total assets
1,490,123

1,537,454

1,499,220

1,514,567

1,484,224

1,438,688

1,454,618

1,432,263

Working capital (1)
685,731

728,131

684,077

677,811

688,237

559,934

556,263

530,196

Non-current financial liabilities
236,685

233,180

229,810

226,500

223,258

220,054

216,977

213,955


(1) 
We report the non-GAAP and additional GAAP financial measures of working capital and realized metal prices per payable ounce of precious metals sold to manage and evaluate operating performance at our mines. For a better understanding and a reconciliation of these measures, please refer to “Non-GAAP and Additional GAAP Financial Measures” in section 9 of this MD&A.

The volatility in revenue over the past eight quarters has resulted from variable precious metal prices, which are not under our control, and sales volumes. There are no significant seasonal fluctuations in the results for the presented periods. Realized gold prices have generally ranged between $1,200 and $1,300 per ounce, though gold prices have strengthened consistently since the first quarter of 2017 while silver prices have remained relatively flat since 2016. Sales volumes have been impacted by normal production variations at the Marigold mine due to its nature as a run-of-mine heap leach operation, generally increasing production at the Seabee Gold Operation and declining production at Puna Operations as the mine processes stockpiles while it transitions to production from the Chinchillas deposit.

Income from mine operations broadly follows the trend in revenue although gross margins have reduced in 2017 following Puna Operations' Pirquitas pit closure. Certain periods have been impacted by non-cash adjustments. Notably, the fourth quarter of 2017 was positively impacted by a $6.3 million reversal of inventory provision as a result of the extended operational plant life at our Puna Operations due to the Chinchillas project, and the first quarter of 2017 was positively impacted by the resolution of the export duty claim in Argentina, which resulted in a non-cash reduction to cost of sales of $4.3 million. Income from mine operations in the fourth quarter of 2016 was negatively affected by non-cash adjustments to inventory and valued added tax ("VAT") at the Pirquitas mine of $3.7 million, and by the recognition of a $5.7 million severance provision related to the Pirquitas mine closure.

Net income before and after income tax has fluctuated significantly over the past eight quarters, heavily influenced by operating performance, metal prices, an impairment reversal and other adjustments. Net income for the second quarter of 2017 was positively impacted by an impairment reversal of the Puna Operations' Pirquitas plant of $24.4 million resulting from its life extension following the formation of the joint venture for the Chinchillas project.



SSR Mining Inc.
MD&A First Quarter 2018 |  15



Three months ended March 31, 2018, compared to the three months ended March 31, 2017

Net loss attributable to our shareholders for the three months ended March 31, 2018 was $1.6 million ($0.01 per share), compared to net income of $15.0 million ($0.13 per share) in the same period of 2017. The following is a summary and discussion of the significant components of income and expenses recorded during the current quarter compared to the same period in the prior year.

Revenue

Realized gold and silver price is a non-GAAP financial measure. Please see the discussion under "Non-GAAP and Additional GAAP Financial Measures" in section 9.

In the three months ended March 31, 2018, we recognized total revenues of $97.9 million, compared to $117.9 million in the comparative period of 2017. This reduction was primarily due to lower sales from Puna Operations and the Marigold mine.

At the Marigold mine, we recognized revenues of $55.9 million in the first quarter of 2018 from the sale of 42,055 payable ounces of gold, realizing an average price of $1,331 per ounce. In the first quarter of 2017, revenues were $63.8 million from the sale of 52,500 payable ounces of gold at an average realized gold price of $1,214 per ounce.

At the Seabee Gold Operation, we recognized revenues of $26.8 million in the first quarter of 2018 from the sale of 20,000 payable ounces of gold, at an average realized gold price of $1,340 per ounce. In the first quarter of 2017, revenues were $27.6 million from the sale of 22,400 payable ounces of gold at an average realized gold price of $1,233 per ounce.

At Puna Operations, we recognized revenues of $15.2 million in the first quarter of 2018, lower than the $26.5 million in the same period in 2017. Sales volumes were lower as mining at the Pirquitas pit ceased in January 2017 and we processed lower grade stockpiled ore. We sold 1.0 million payable ounces of silver in the first quarter of 2018, lower than the 1.4 million payable ounces sold in the comparative period. In addition to lower sales, realized silver prices were also lower in the first quarter of 2018, which averaged $16.79 per ounce, excluding the impact of period-end price adjustments, compared to $17.35 per ounce in the same period in 2017. We also had a negative mark-to-market impact of $0.1 million in the first quarter of 2018, compared to a positive $4.9 million in the same period in 2017. At March 31, 2018, sales contracts containing 0.7 million ounces of silver were subject to final price settlement over the next three months.

Cost of sales

Cost of sales for the first quarter of 2018 was $80.7 million, comparable to the $77.8 million in the first quarter of 2017.

At the Marigold mine, cost of sales in the first quarter of 2018 was $43.6 million, generating income from mine operations of $12.3 million, equal to a gross margin of 21.7%. This compares to cost of sales of $42.4 million in the first quarter of 2017, generating income from mine operations of $21.3 million and a gross margin of 33.4%. The lower margin was due to higher unit cost of inventory, higher depreciation and depletion per gold ounce sold and partially off-set by the higher realized price of gold in the current period.

At the Seabee Gold Operation, cost of sales in the first quarter of 2018 was $20.1 million, generating income from operations of $6.7 million, equal to a gross margin of 24.9%. In the comparative period of 2017, cost of sales was $22.6 million, generating income from operations of $5.0 million, equal to a gross margin of 18.1%. The higher margin is due to lower unit cost of inventory and the higher realized price of gold in the current period. This is despite the fact that depreciation was higher in the first quarter of 2018 as depreciation on certain assets at the Seabee mine was accelerated pending its closure.

At Puna Operations, cost of sales in the first quarter of 2018 was $17.0 million, resulting in a loss from mine operations of $1.8 million, equal to a negative gross margin of 11.5%. This compared to cost of sales of $12.8 million in the first quarter of 2017, generating income from mine operations of $13.8 million and a gross margin of 51.9%. The high margin in the comparable quarter of 2017 was positively impacted by a non-cash impact of $4.3 million of export duties following the resolution of the export duty claim in Argentina, significantly higher

SSR Mining Inc.
MD&A First Quarter 2018 |  16



mark-to-market adjustments to revenue, higher realized prices and lower unit cost of inventory than in the current quarter.

Other operating costs

General and administrative expenses in the three months ended March 31, 2018, of $6.7 million were lower than the $7.9 million recorded in the three months ended March 31, 2017. This was primarily due to cash-settled share-based compensation expense which was $2.5million in the first quarter of 2018 compared to $3.4 million in the three months ended March 31, 2017, due to weaker relative and absolute share price performance.

Exploration and evaluation costs of $2.8 million for the three months ended March 31, 2018, were lower than the $7.4 million for the three months ended March 31, 2017. A significant factor that caused the 2017 period to be high was the re-measurement of the reclamation liability at the Pirquitas mine of $3.7 million. The majority of expenditures in the first quarter of each of 2018 and 2017 related to greenfield exploration work performed at the Seabee Gold Operation.

Non-operating items

During the first quarter of 2018, we recorded interest expense and other finance costs of $8.8 million compared to $6.6 million recorded in the first quarter of 2017. In each period, the interest expense was mainly attributable to our 2.875% convertible senior notes (the “Notes”). In the first quarter of 2018, we also incurred interest expense of $2.7 million as part of the export duty moratorium settlement with the Argentine government.

We recorded a foreign exchange gain for the three months ended March 31, 2018, of $1.9 million compared to $0.6 million in the three months ended March 31, 2017. Our main foreign exchange exposures are related to the ARS and CAD. During the three months ended March 31, 2018, this gain resulted mainly from a weaker ARS in which our moratorium liability is denominated, partially offset by the declining VAT receivable as we continue with its collection.

Taxation

For the three months ended March 31, 2018, we recorded an income tax expense of $1.5 million compared to an income tax expense of $3.4 million in the three months ended March 31, 2017. The total income tax expense for both periods was a result of the profitable operations at the Marigold mine and Seabee Gold Operation, concentrate, and gold sales activities in Canada, offset by the general and administrative expenses in Canada.

Other comprehensive income

During the first quarter of 2018, we recognized a loss, net of tax of $38.3 million on marketable securities, compared to a gain of $35.6 million in the first quarter of 2017, primarily driven by valuation movements in our investment in Pretium.


SSR Mining Inc.
MD&A First Quarter 2018 |  17



Financial Position and Liquidity
 
 
As at March 31

 
As at December 31,

 
 
2018

 
2017

 
 
$'000

 
$'000

Cash and cash equivalents
 
472,901

 
459,864

Working capital (1)
 
685,731

 
728,131

Total assets
 
1,490,123

 
1,537,454

Non-current financial liabilities
 
236,685

 
233,180

 
 
 
 
 
 
 
For the period ended March 31,
 
 
 
2018

 
2017

 
 
$'000

 
$'000

Cash generated by operating activities
 
11,007

 
30,643

Cash generated by (used in) investing activities
 
1,387

 
(18,119
)
Cash generated by financing activities
 
1,916

 
335


(1) We report the additional GAAP financial measure of working capital to manage and evaluate operating performance at our mines. For a better understanding of this measure, please refer to “Non-GAAP and Additional GAAP Financial Measures” in Section 9.

Liquidity

At March 31, 2018, we had $472.9 million of cash and cash equivalents, an increase of $13.0 million from December 31, 2017. Our first quarter of 2018 cash generated from operating activities was $11.0 million compared to $30.6 million in the same period of 2017. This was mainly due to lower sales, lower production and an increase in finished goods inventory at the Seabee Gold Operation, but was also impacted by tax installments of $2.2 million that were not incurred in 2017. From our cash from operating activities in the first quarter of 2018, we funded $8.8 million investment in plant and equipment, $2.9 million of capitalized stripping and $2.3 million of underground development. We also invested $11.7 million in the development of the Chinchillas project. We received $28.1 million from the sale of a portion of our common shares of Pretium.

At March 31, 2018, our working capital position decreased to $685.7 million, which was a decrease of $42.4 million from $728.1 million at December 31, 2017, mainly due to the reduction in value of our marketable securities. We manage our liquidity position with the objectives of ensuring sufficient funds available to meet planned operating requirements and providing support to fund strategic growth initiatives. Our cash balance at March 31, 2018, along with projected operating cash flows, are expected to be sufficient to fund planned activities over the next twelve months from the date of this MD&A. We continue to focus on capital allocation and our cost reduction strategy while also implementing various optimization activities at our operations to improve the cash generating capacity of each mine.

Of our current cash and cash equivalents balance, $452.3 million was held in Canada and the United States. At March 31, 2018, we had $20.5 million cash in Argentina, which was mostly held in USD. All cash is invested in short-term investments or high interest savings accounts under our investment policy with maturities of 90 days or less providing us with sufficient liquidity to meet our foreseeable corporate needs.

Capital Resources
Our objectives when managing capital are to:
safeguard our ability to continue as a going concern in order to develop and operate our current projects and pursue strategic growth initiatives; and
maintain a flexible capital structure which lowers our cost of capital.
In assessing our capital structure, we include in our assessment the components of shareholders’ equity and our Notes. In order to facilitate the management of capital requirements, we prepare annual expenditure budgets and continuously monitor and review actual and forecasted cash flows. The annual and updated budgets are monitored and approved by our Board of Directors.

SSR Mining Inc.
MD&A First Quarter 2018 |  18



To maintain or adjust the capital structure, we may, from time to time, issue new shares or debt, repay debt or dispose of non-core assets. We expect our current capital resources will be sufficient to carry out our exploration plans and support operations through the current operating period.

Our $75 million senior secured revolving credit facility has a term to June 8, 2020, with a $25.0 million accordion. As of March 31, 2018, we were in compliance with externally-imposed financial covenants in relation to our credit facility. Our Notes do not contain any financial covenants.

As at March 31, 2018, we had 119,932,099 common shares and 3,205,973 stock options outstanding which are exercisable into common shares at exercise prices ranging between $3.30 CAD and $24.41 CAD per share.

Outstanding share data

Our authorized capital consists of an unlimited number of common shares without par value. As at May 10, 2018, the following common shares and options were outstanding:
 
Number of shares

Exercise price
Remaining life
 
 
C$
(years)
Capital stock
119,994,030

 
 
Stock options
3,311,406

3.30 - 24.41
0.11 - 6.90
Other share-based compensation awards
668,530

 
0.90 - 9.91
Fully diluted
123,973,966