SSR Mining Inc. — FY 2023 Form 10-K
Reporting period: Fiscal year ended December 31, 2023. The filing was signed February 27, 2024. Unless noted, figures are in U.S. dollars. The February 13, 2024 Çöpler incident occurred after year-end and is disclosed as a non-adjusting subsequent event; its effects are not reflected in FY 2023 financial statements.
Business context and reporting period
SSR Mining operates four reportable mines: Çöpler in Türkiye (80% interest), Marigold in Nevada, Seabee in Saskatchewan, and Puna in Argentina. It produces gold doré and silver, lead, and zinc concentrates. Çöpler generated 31% of FY 2023 revenue; Marigold 38%, Seabee 11%, and Puna 20%.
Key financial and operating metrics
| Metric | FY 2023 | FY 2022 |
|---|---|---|
| Revenue | $1,426.9 million | $1,148.0 million |
| Operating income (loss) | $(130.2) million | $190.3 million |
| Net income (loss) attributable to SSR shareholders | $(98.0) million; $(0.48) per diluted share | $194.1 million; $0.92 basic per share |
| Adjusted attributable net income (non-GAAP) | $276.5 million; $1.29 per diluted share | $144.8 million; $0.67 per diluted share |
| Cash provided by operating activities | $421.7 million | $160.9 million |
| Free cash flow (non-GAAP) | $198.3 million | $23.4 million |
| Cash and cash equivalents at year-end | $492.4 million | $655.5 million |
| Gold-equivalent production | 706,894 ounces | 623,819 ounces |
| Cost of sales per gold-equivalent ounce sold | $1,141 | $985 |
| AISC per gold-equivalent ounce sold (non-GAAP) | $1,461 | $1,339 |
FY 2023 revenue rose 24.3%, reflecting higher gold and silver volumes and realized prices. Average realized prices were $1,950 per gold ounce and $22.82 per silver ounce. Cost of sales increased 32.3%; the filing attributes the increase to higher sales volumes, operating costs, and inflation. The reported operating loss equates to an operating margin of approximately negative 9.1% of revenue.
FY 2023 production increased 13.3% and met company guidance. Marigold achieved record gold production of 278,488 ounces; Puna achieved record silver production of 9.69 million ounces. Seabee production fell 33.3% to 90,777 gold ounces, mainly due to lower mill-feed grade and recovery. Puna silver production rose 15.4% to 9.69 million ounces.
The net loss included $411.4 million of impairment charges: principally $349.2 million related to Çöpler long-lived and exploration assets, $49.8 million for Seabee goodwill, and other asset write-offs. The Çöpler impairment arose from revised reserves and project assumptions and was explicitly unrelated to the February 2024 incident. The company also recorded a $105.7 million foreign-exchange loss, primarily associated with Argentine peso-denominated assets and the fourth-quarter currency devaluation.
Debt, liquidity, and capital allocation
- Year-end debt carrying value was $228.4 million, primarily the $230 million face amount of 2.50% convertible notes due 2039. The term loan was fully repaid in September 2023.
- The $400 million revolving credit facility, with a further $100 million accordion feature and maturity in August 2027, was undrawn at year-end. SSR reported compliance with its covenants.
- FY 2023 cash declined by $163.1 million on the balance sheet. Cash flows included $223.4 million of capital expenditures, $119.9 million for acquisitions, $71.2 million of scheduled debt principal repayments, $57.7 million of dividends, and $56.3 million of share repurchases. Operating cash flow was $421.7 million.
- Management stated after the incident that available liquidity and expected cash flows from the other three mines were sufficient, at a minimum, for their operating needs and Çöpler care, monitoring, and remediation over the next 12 months. This assessment did not quantify potential fines, third-party claims, insurance recoveries, or other uncertain obligations.
- After the incident, the Board suspended dividends; the company also halted share repurchases and gave notice to terminate its automatic share purchase plan effective March 1, 2024. Resumption timing is unknown.
Material changes versus the prior comparable period
- Revenue rose 24.3% and gold-equivalent production rose 13.3%; operating cash flow increased to $421.7 million from $160.9 million.
- Cost of sales per gold-equivalent ounce increased 15.8%, while AISC per ounce increased 9.1%.
- SSR moved from attributable net income of $194.1 million in 2022 to an attributable net loss of $98.0 million in 2023, mainly reflecting impairments and foreign-exchange losses, among other factors.
- Production trends diverged by mine: Marigold and Puna increased output, while Seabee’s gold output declined materially. Çöpler production increased versus 2022, which included a temporary suspension during 2022.
- Year-end cash and cash equivalents decreased from $655.5 million to $492.4 million. SSR expanded its revolver to $400 million and repaid the term loan.
Outlook, commentary, risks, and unusual items
- Çöpler incident: On February 13, 2024, approximately one-third of the material stacked on the oxide heap-leach pad slipped. All Çöpler operations were suspended, and the company cannot estimate when or under what conditions they may resume. Nine workers remained missing as described in the filing.
- Türkiye revoked Çöpler’s environmental permit pending investigation and remediation. Government-directed containment and remediation efforts were ongoing; the overdrain pipeline was damaged. Preliminary government testing was reported negative for contamination in monitored locations, but further testing was planned.
- Six employees had been charged with criminal offenses related to actions on the day of the incident. The company is cooperating with authorities. Potential remediation costs, penalties, claims, insurance coverage, and further impairments remained uncertain; SSR anticipated recording a material remediation liability and incident-related asset impairments in the first quarter of 2024.
- Çöpler contributed 220,999 gold-equivalent ounces, or 31% of company production, in 2023. The oxide heap-leach circuit represented approximately 11% of Çöpler production and revenue. The other three mines operate independently, and management did not expect them to be directly affected operationally.
- Management provided no reliable estimate of the incident’s full financial impact or resumption schedule. The filing’s 2023 production guidance was met, but the supplied filing text does not provide a revised post-incident production or cost outlook.
- Other key risks include volatile precious- and base-metal prices, inflation and foreign-exchange exposure, permitting and political risks, mine-safety and geotechnical hazards, water and energy availability, reserve-estimation uncertainty, and potentially insufficient insurance.
Important facts for investors to verify
- Updates on the Çöpler investigation, missing workers, permit status, remediation scope and schedule, and whether operations can resume.
- The amount and timing of the remediation liability, incident-related impairments, legal or regulatory penalties, third-party claims, and insurance proceeds or coverage limits.
- Liquidity under downside scenarios, including the cash requirements of the other mines and Çöpler, and the company’s ability to draw on the revolver while meeting financial covenants.
- Updated production, cost, capital-spending, and mine-plan guidance, including the effect of Çöpler suspension on consolidated output and the Hod Maden development project.
- Performance at Seabee following its lower 2023 grades and full goodwill impairment, and whether Marigold’s production gains and Puna’s throughput and recovery improvements are sustainable.
- Metal-price, Argentine peso, Turkish lira, and inflation sensitivities, as well as the status of suspended dividends and share repurchases.
Adjusted earnings, free cash flow, cash costs, and AISC are non-GAAP measures; the company provides reconciliations in the filing. They should be considered alongside, not as substitutes for, U.S. GAAP results.