Stillwater Mining Reports 2008 Results
COLUMBUS, MT - Stillwater Mining Company reported a 2008 net loss of $112.7 million, or $1.21 per diluted share, on revenues of $855.7 million. The 2008 results reflect the steep deterioration of the world economy and platinum-group metal (PGM) prices during the second half of 2008, and include fourth quarter impairment charges totaling $70.7 million, comprised of a $67.3 million carrying value adjustment at the East Boulder Mine and a $3.4 million charge to mark long-term investments to current market. Additional 2008 charges include a $16.6 million lower-of-cost-or-market inventory adjustment, a $29.4 million write-down of trade receivables and advances for inventory purchases, and a $5.4 million provision for corporate restructuring. At the same time during the fourth quarter, the Company's available cash, cash equivalents and short-term investments (excluding restricted cash) increased by $51.8 million, driven mostly by reductions in working capital required in the recycling segment as prices fell and business slowed.
The 2008 net loss compares to a 2007 net loss of $15.5 million on revenues of $673.0 million. Revenues for 2007 have been revised to include $53.8 million in proceeds from sales of by-products, which previously were credited against mining costs of metals sold.
The Company's net loss for the fourth quarter of 2008, including the impairment charges, was $131.9 million, or $1.41 per diluted share, on revenues of $182.0 million. This compares to the fourth quarter of 2007, when the Company reported net income of $0.1 million, or less than $0.01 per share, on revenues of $162.4 million
Metal prices began to decline in mid-July 2008, following a period of exceptional strength in PGM prices in the first half of the year. By October, as the world economic picture deteriorated, PGM prices were down to levels not seen since 2003. The effect of these exceptionally low prices during the 2008 fourth quarter eliminated the profitability the Company reported for the first nine months and led to a fourth quarter operational restructuring and impairment charges that resulted in the substantial reported loss for the full year.
The Company mines palladium and platinum from two underground mines located in south-central Montana. The mines produced a total of 498,900 ounces of palladium and platinum during 2008, down 7.2% from the 537,500 ounces produced in 2007. Production at the Company's Stillwater Mine declined slightly to 349,400 ounces, compared to 359,300 ounces during 2007, while East Boulder Mine production was reduced to 149,500 ounces from 178,200 ounces last year. Stillwater Mine's reduced production reflected mostly lower combined ore grades in the active mining areas. The reduced East Boulder Mine production in part resulted from the brief suspension of mining and a subsequent operational restructuring and downsizing during the fourth quarter of 2008. Average sales realizations (net of hedging losses) on mined palladium and platinum ounces for the full year increased to $630 per ounce in 2008, up from $509 per ounce in 2007, reflecting very strong metals prices during the first half of 2008. However, fourth quarter 2008 sales realizations averaged only $498 per ounce, as metal prices declined sharply in that period.
The company's address is 536 East Pike Avenue, P.O. Box 1330, Columbus, MT 59019, (406) 322-8700, fax: (406) 322-8701, email: [email protected].
COLUMBUS, MT - Stillwater Mining Company reported a 2008 net loss of $112.7 million, or $1.21 per diluted share, on revenues of $855.7 million. The 2008 results reflect the steep deterioration of the world economy and platinum-group metal (PGM) prices during the second half of 2008, and include fourth quarter impairment charges totaling $70.7 million, comprised of a $67.3 million carrying value adjustment at the East Boulder Mine and a $3.4 million charge to mark long-term investments to current market. Additional 2008 charges include a $16.6 million lower-of-cost-or-market inventory adjustment, a $29.4 million write-down of trade receivables and advances for inventory purchases, and a $5.4 million provision for corporate restructuring. At the same time during the fourth quarter, the Company's available cash, cash equivalents and short-term investments (excluding restricted cash) increased by $51.8 million, driven mostly by reductions in working capital required in the recycling segment as prices fell and business slowed.
The 2008 net loss compares to a 2007 net loss of $15.5 million on revenues of $673.0 million. Revenues for 2007 have been revised to include $53.8 million in proceeds from sales of by-products, which previously were credited against mining costs of metals sold.
The Company's net loss for the fourth quarter of 2008, including the impairment charges, was $131.9 million, or $1.41 per diluted share, on revenues of $182.0 million. This compares to the fourth quarter of 2007, when the Company reported net income of $0.1 million, or less than $0.01 per share, on revenues of $162.4 million
Metal prices began to decline in mid-July 2008, following a period of exceptional strength in PGM prices in the first half of the year. By October, as the world economic picture deteriorated, PGM prices were down to levels not seen since 2003. The effect of these exceptionally low prices during the 2008 fourth quarter eliminated the profitability the Company reported for the first nine months and led to a fourth quarter operational restructuring and impairment charges that resulted in the substantial reported loss for the full year.
The Company mines palladium and platinum from two underground mines located in south-central Montana. The mines produced a total of 498,900 ounces of palladium and platinum during 2008, down 7.2% from the 537,500 ounces produced in 2007. Production at the Company's Stillwater Mine declined slightly to 349,400 ounces, compared to 359,300 ounces during 2007, while East Boulder Mine production was reduced to 149,500 ounces from 178,200 ounces last year. Stillwater Mine's reduced production reflected mostly lower combined ore grades in the active mining areas. The reduced East Boulder Mine production in part resulted from the brief suspension of mining and a subsequent operational restructuring and downsizing during the fourth quarter of 2008. Average sales realizations (net of hedging losses) on mined palladium and platinum ounces for the full year increased to $630 per ounce in 2008, up from $509 per ounce in 2007, reflecting very strong metals prices during the first half of 2008. However, fourth quarter 2008 sales realizations averaged only $498 per ounce, as metal prices declined sharply in that period.
The company's address is 536 East Pike Avenue, P.O. Box 1330, Columbus, MT 59019, (406) 322-8700, fax: (406) 322-8701, email: [email protected].