Molycorp Reports Third Quarter 2014 Financial Results
Greenwood Village, CO (November 5, 2014) - Molycorp, Inc. (NYSE: MCP) ("Molycorp" or the "Company") today announced financial and operating results for the third quarter 2014.
The Company reported consolidated net revenues in the third quarter of 2014 of $123.9 million, a 6% increase over the preceding quarter. Product sales volume in the quarter was 3,356 metric tons (mt), a 12% sequential increase, at an average selling price ("ASP") of $36.93/kg, a 5% decrease over the preceding quarter's ASP of $39.02/kg.
The Company reported a net loss of $0.47 per share for the quarter, and a net loss of $0.40 per share for the quarter on an adjusted non-GAAP basis.
Molycorp's Resources segment, comprised of its Mountain Pass, California rare earth mine and processing facility, sold 1,085 mt of rare earth oxide ("REO") equivalent products for $13.9 million in revenues, a 39% increase over the second quarter of 2014. ASP for the quarter was $12.84/kg, which was 25% higher than the preceding quarter due to a more favorable product mix. Production volume for the quarter was 691 mt, a 58% decrease over second quarter production of 1,639 mt. Cash cost for production increased to $33.80/kg, a 104% increase over production cash costs of $16.54/kg in the previous quarter, largely due to the limited availability of hydrochloric acid needed for production.
The Company's Chemicals and Oxides segment sold 1,651 mt and reported $43.5 million in revenues. The slight sequential increase in volume was offset by lower ASP of $26.33/kg. due to a less favorable product mix.
Its Magnetic Materials and Alloys segment sold 1,516 mt of magnetic powders and reported third quarter revenues of $62.7 million on ASP of $40.42/kg. This compares to second quarter revenues of $54.4 million on an ASP of $39.31/kg. for the segment.
Finally, Molycorp's Rare Metals segment reported sales volume of 104 mt on revenues of $21.3 million. ASP for the segment was $204.51/kg. Second quarter revenues were $15.9 million on ASP of $201.81/kg.
THIRD QUARTER 2014 RESULTS
During the third quarter, the Company sold 3,356 mt of product at an ASP of $36.93/kg, and generated a gross loss of $15.1 million. This compares to sales volumes of 2,996 mt at an ASP of $39.02/kg and a gross loss of $16.6 million during the second quarter of 2014.
Molycorp reported a loss attributable to common stockholders of $105.2 million, or $0.47 per share. Adjusted loss per share of $0.40 in the third quarter does not reflect out-of-ordinary business expenses, and certain other non-cash items.
The Company reported negative cash flows from operating activities of $28.2 million for the quarter ended September 30, 2014, and had $313.5 million in cash and cash equivalents as of September 30, 2014.
During the three months ended September 30, 2014, Molycorp's capital expenditures were $18.2 million on a cash basis.
CONFERENCE CALL TOMORROW AT 9:00 A.M. EASTERN STANDARD TIME
Molycorp will conduct a conference call on Thursday, November 6, 2014 to discuss these results at 9:00 a.m. EST, hosted by Geoff Bedford, President and Chief Executive Officer, and Michael Doolan, Executive Vice President and Chief Financial Officer. Investors interested in participating in the live call from the U.S. should dial +1 (877) 474-9501 and reference passcode number 59522823. Those calling from outside the U.S. should dial +1 (857) 244-7554 and reference the same passcode as above.
There will also be a simultaneous live audio webcast available on the Investor Relations section of the Company's website at www.molycorp.com/investors. The webcast will be archived on the website. A PowerPoint presentation that will be broadcast live via webcast during the conference call will be made available on the website immediately prior to the call.
NON-GAAP ADJUSTED NET LOSS, OIBDA and ADJUSTED OIBDA
Adjusted Net Loss excludes certain non-cash items and other out-of-ordinary business expense and operational expansion items. The Company defines OIBDA as operating income before depreciation, amortization and accretion. Adjusted OIBDA consists of OIBDA excluding certain non-cash items and other out-of-ordinary business expense and operational expansion items. Adjusted Net Loss, OIBDA and Adjusted OIBDA are all non-GAAP financial measures. There have been no changes in the calculation method of previously disclosed non-GAAP financial measures. The Company's management believes adjusting out these items from Net Loss and OIBDA, including but not limited to purchase accounting adjustments, stock-based compensation, out-of-ordinary expenses/income, asset impairment charges and other miscellaneous charges, is useful to investors because it provides an overall understanding of the Company's historical financial performance and future prospects. Management believes that Adjusted Net Loss, OIBDA and Adjusted OIBDA are an indication of the Company's base-line performance. Exclusion of these items permits evaluation and comparison of results for the Company's core business operations, and it is on this basis that management internally assesses the Company's performance.
# # #
FOR MORE INFORMATION:
Company Contacts:
Jim Sims, +1 (303) 843-8062
Vice President Corporate Communications
jim.sims@molycorp.com
Brian Blackman, +1 (303) 843-8067
Vice President Investor Relations
brian.blackman@molycorp.com
FINANCIAL STATEMENTS AND SUPPLEMENTARY TABLES
TABLE 1: BALANCE SHEETS
MOLYCORP, INC.
Condensed Consolidated Balance Sheets (Unaudited)
(In thousands, except shares and per share amounts)
| September 30, 2014 | December 31, 2013 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 313,477 | $ | 314,317 | |||
| Trade accounts receivable, net | 53,229 | 61,757 | |||||
| Inventory | 166,936 | 171,783 | |||||
| Prepaid expenses and other current assets | 27,175 | 29,210 | |||||
| Total current assets | 560,817 | 577,067 | |||||
| Non-current assets: | |||||||
| Deposits | 29,999 | 25,997 | |||||
| Property, plant and equipment, net | 1,736,872 | 1,762,874 | |||||
| Inventory | 25,530 | 25,329 | |||||
| Intangible assets, net | 312,878 | 330,867 | |||||
| Investments | 32,210 | 48,875 | |||||
| Goodwill | 228,750 | 228,750 | |||||
| Other non-current assets | 34,203 | 7,043 | |||||
| Total non-current assets | 2,400,442 | 2,429,735 | |||||
| Total assets | $ | 2,961,259 | $ | 3,006,802 | |||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
| Current liabilities: | |||||||
| Trade accounts payable | $ | 58,272 | $ | 84,449 | |||
| Accrued expenses | 66,727 | 48,501 | |||||
| Debt and capital lease obligations | 12,769 | 16,362 | |||||
| Other current liabilities | 6,922 | 4,063 | |||||
| Total current liabilities | 144,690 | 153,375 | |||||
| Non-current liabilities: | |||||||
| Asset retirement obligation | 16,681 | 16,966 | |||||
| Deferred tax liabilities | 75,162 | 85,481 | |||||
| Debt and capital lease obligations | 1,582,802 | 1,363,916 | |||||
| Other non-current liabilities | 14,286 | 10,002 | |||||
| Total non-current liabilities | 1,688,931 | 1,476,365 | |||||
| Total liabilities | $ | 1,833,621 | $ | 1,629,740 | |||
| Stockholders' equity: | |||||||
| Common stock, $0.001 par value; 700,000,000 shares authorized at September 30, 2014 and 350,000,000 at December 31, 2013 | 245 | 241 | |||||
| Preferred stock, $0.001 par value; 5,000,000 shares authorized at December 31, 2013 | - | 2 | |||||
| Additional paid-in capital | 2,232,390 | 2,194,405 | |||||
| Accumulated other comprehensive loss | (15,704 | ) | (6,451 | ) | |||
| Accumulated deficit | (1,115,614 | ) | (840,474 | ) | |||
| Total Molycorp stockholders' equity | 1,101,317 | 1,347,723 | |||||
| Noncontrolling interests | 26,321 | 29,339 | |||||
| Total stockholders' equity | 1,127,638 | 1,377,062 | |||||
| Total liabilities and stockholders' equity | $ | 2,961,259 | $ | 3,006,802 | |||
TABLE 2: INCOME STATEMENTS AND EARNINGS PER SHARE
MOLYCORP, INC.
Condensed Consolidated Statements of Operations (Unaudited)
(In thousands, except shares and per share amounts)
| Third Quarter | Second Quarter | Third Quarter | |||||||||
| 2014 | 2014 | 2013 | |||||||||
| Revenues | $ | 123,937 | $ | 116,907 | $ | 149,066 | |||||
| Costs of sales: | |||||||||||
| Costs excluding depreciation and amortization | (119,633 | ) | (113,399 | ) | (150,444 | ) | |||||
| Depreciation and amortization | (19,382 | ) | (20,079 | ) | (16,400 | ) | |||||
| Gross loss | (15,078 | ) | (16,571 | ) | (17,778 | ) | |||||
| Operating expenses: | |||||||||||
| Selling, general and administrative | (21,907 | ) | (20,424 | ) | (24,468 | ) | |||||
| Depreciation, amortization and accretion | (8,093 | ) | (7,257 | ) | (10,072 | ) | |||||
| Research and development | (4,353 | ) | (4,483 | ) | (5,565 | ) | |||||
| Impairment of long-lived assets | - | - | (1,118 | ) | |||||||
| Operating loss | (49,431 | ) | (48,735 | ) | (59,001 | ) | |||||
| Other (expenses) income: | |||||||||||
| Other (expense) income | (2,611 | ) | 296 | (891 | ) | ||||||
| Impairment of investment | (12,000 | ) | - | - | |||||||
| Interest expense, net of capitalized interest | (35,442 | ) | (41,285 | ) | (16,289 | ) | |||||
| Loss before income taxes and equity earnings | (99,484 | ) | (89,724 | ) | (76,181 | ) | |||||
| Income tax benefit | (3,572 | ) | 7,427 | 12,902 | |||||||
| Equity in loss of affiliates | (2,092 | ) | (1,553 | ) | (2,334 | ) | |||||
| Loss from continuing operations | (105,148 | ) | (83,850 | ) | (65,613 | ) | |||||
| Loss from discontinued operations, net of tax | - | - | (4,186 | ) | |||||||
| Net loss | (105,148 | ) | (83,850 | ) | (69,799 | ) | |||||
| Net income attributable to noncontrolling interests | (31 | ) | (49 | ) | (130 | ) | |||||
| Net loss attributable to Molycorp stockholders | $ | (105,179 | ) | $ | (83,899 | ) | $ | (69,929 | ) | ||
| Earnings per share of common stock: | |||||||||||
| Net loss attributable to Molycorp stockholders | $ | (105,179 | ) | $ | (83,899 | ) | $ | (69,929 | ) | ||
| Dividends on Convertible Preferred Stock | - | - | (2,846 | ) | |||||||
| Loss attributable to common stockholders | $ | (105,179 | ) | $ | (83,899 | ) | $ | (72,775 | ) | ||
| Weighted average common shares outstanding-basic | 224,270,303 | 224,223,506 | 168,114,266 | ||||||||
| Basic loss per share: | $ | (0.47 | ) | $ | (0.37 | ) | $ | (0.43 | ) | ||
| Weighted average common shares outstanding-diluted | 224,270,303 | 224,223,506 | 168,114,266 | ||||||||
| Diluted loss per share: | $ | (0.47 | ) | $ | (0.37 | ) | $ | (0.43 | ) | ||
TABLE 3: STATEMENTS OF CASH FLOWS
MOLYCORP, INC
Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
| Nine Months Ended September 30, | |||||||
| 2014 | 2013 | ||||||
| Cash flows from operating activities: | |||||||
| Net loss | $ | (274,998 | ) | $ | (178,639 | ) | |
| Adjustments to reconcile net loss to net cash from operating activities: | |||||||
| Depreciation, amortization and accretion | 78,161 | 75,870 | |||||
| Deferred income tax benefit | (18,809 | ) | (36,399 | ) | |||
| Inventory write-downs | 51,638 | 74,475 | |||||
| Release of inventory step-up value | 742 | 5,650 | |||||
| Impairment of investment | 12,000 | - | |||||
| Impairment of long-lived assets | - | 4,949 | |||||
| Stock-based compensation | 3,784 | 2,399 | |||||
| Equity in results of affiliates | 5,368 | 8,690 | |||||
| Other operating adjustments | 8,766 | (1,796 | ) | ||||
| Net change in operating assets and liabilities | (13,058 | ) | (45,212 | ) | |||
| Net cash used in operating activities | (146,406 | ) | (90,013 | ) | |||
| Cash flows from investing activities: | |||||||
| Investment in joint ventures | (703 | ) | (3,423 | ) | |||
| Capital expenditures | (62,837 | ) | (334,597 | ) | |||
| Recovery from insurance claims | 12,900 | - | |||||
| Other investing activities | 460 | (364 | ) | ||||
| Net cash used in investing activities | (50,180 | ) | (338,384 | ) | |||
| Cash flows from financing activities: | |||||||
| Repayments of debt | (5,879 | ) | (25,990 | ) | |||
| Net proceeds from sale of common stock | - | 248,150 | |||||
| Issuance of 5.50% Convertible Notes | - | 165,600 | |||||
| Debt issuance costs | (14,768 | ) | - | ||||
| Net proceeds from the Financings | 250,000 | - | |||||
| Partial repayment of convertible notes | (27,495 | ) | - | ||||
| Payments of preferred dividends | (2,846 | ) | (8,539 | ) | |||
| Dividend paid to noncontrolling interests | (3,170 | ) | (4,472 | ) | |||
| Other financing activities | 1,626 | (797 | ) | ||||
| Net cash (used in) provided by financing activities | 197,468 | 373,952 | |||||
| Effect of exchange rate changes on cash | (1,722 | ) | 569 | ||||
| Net change in cash and cash equivalents | (840 | ) | (53,876 | ) | |||
| Cash and cash equivalents at beginning of the period | 314,317 | 227,790 | |||||
| Cash and cash equivalents at end of period | $ | 313,477 | $ | 173,914 | |||
TABLE 4: SEGMENT INFORMATION
| Three months ended September 30, 2014 | Resources | Chemicals and Oxides | Magnetic Materials and Alloys | Rare Metals | Corporate and other (a) | Eliminations(b) | Total Molycorp, Inc. | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||||||
| External | $ | 4,509 | $ | 36,814 | $ | 61,345 | $ | 21,269 | $ | - | $ | 123,937 | |||||||||||||||
| Inter-segment | 9,424 | 6,658 | 1,342 | - | (17,424 | ) | - | ||||||||||||||||||||
| Total revenues | $ | 13,933 | $ | 43,472 | $ | 62,687 | $ | 21,269 | $ | (17,424 | ) | $ | 123,937 | ||||||||||||||
| OIBDA | $ | (31,087 | ) | $ | 4,251 | $ | 13,715 | $ | 595 | ||||||||||||||||||
| Depreciation, amortization and accretion | (17,332 | ) | (3,823 | ) | (4,232 | ) | (2,034 | ) | |||||||||||||||||||
| Operating (loss) income | $ | (48,419 | ) | $ | 428 | $ | 9,483 | $ | (1,439 | ) | $ | (9,065 | ) | $ | (419 | ) | $ | (49,431 | ) | ||||||||
| Other income | (2,611 | ) | |||||||||||||||||||||||||
| Impairment of investment | (12,000 | ) | |||||||||||||||||||||||||
| Interest expense, net of capitalized interest | (35,442 | ) | |||||||||||||||||||||||||
| Loss before income taxes and equity earnings | $ | (99,484 | ) | ||||||||||||||||||||||||
| Three months ended June 30, 2014 | Resources | Chemicals and Oxides | Magnetic Materials and Alloys | Rare Metals | Corporate and other (a) | Eliminations(b) | Total Molycorp, Inc. | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||||||
| External | $ | 2,331 | $ | 45,437 | $ | 53,195 | $ | 15,944 | $ | - | $ | 116,907 | |||||||||||||||
| Inter-segment | 7,706 | 3,195 | 1,165 | - | (12,066 | ) | - | ||||||||||||||||||||
| Total revenues | $ | 10,037 | $ | 48,632 | $ | 54,360 | $ | 15,944 | $ | (12,066 | ) | $ | 116,907 | ||||||||||||||
| OIBDA | $ | (30,298 | ) | $ | 4,836 | $ | 11,812 | $ | 740 | ||||||||||||||||||
| Depreciation, amortization and accretion | (17,009 | ) | (3,908 | ) | (4,261 | ) | (2,101 | ) | |||||||||||||||||||
| Operating (loss) income | $ | (47,307 | ) | $ | 928 | $ | 7,551 | $ | (1,361 | ) | $ | (9,083 | ) | $ | 537 | $ | (48,735 | ) | |||||||||
| Other income | 296 | ||||||||||||||||||||||||||
| Interest expense, net of capitalized interest | (41,285 | ) | |||||||||||||||||||||||||
| Loss before income taxes and equity earnings | $ | (89,724 | ) | ||||||||||||||||||||||||
| Three months ended September 30, 2013 | Resources | Chemicals and Oxides | Magnetic Materials and Alloys | Rare Metals | Corporate and other (a) | Eliminations(b) | Total Molycorp, Inc. | ||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||||||
| External | $ | 4,655 | $ | 50,791 | $ | 72,626 | $ | 20,994 | - | $ | 149,066 | ||||||||||||||||
| Inter-segment | 8,858 | 7,174 | - | - | (16,032 | ) | - | ||||||||||||||||||||
| Total revenues | $ | 13,513 | $ | 57,965 | $ | 72,626 | $ | 20,994 | $ | (16,032 | ) | $ | 149,066 | ||||||||||||||
| OIBDA | $ | (44,673 | ) | $ | 4,561 | $ | 18,520 | $ | (911 | ) | |||||||||||||||||
| Depreciation, amortization and accretion | (10,853 | ) | (5,960 | ) | (7,458 | ) | (2,144 | ) | |||||||||||||||||||
| Operating (loss) income | $ | (55,526 | ) | $ | (1,399 | ) | $ | 11,062 | $ | (3,055 | ) | $ | (10,806 | ) | $ | 723 | $ | (59,001 | ) | ||||||||
| Other income | (891 | ) | |||||||||||||||||||||||||
| Interest expense, net of capitalized interest | (16,289 | ) | |||||||||||||||||||||||||
| Loss before income taxes and equity earnings | $ | (76,181 | ) | ||||||||||||||||||||||||
- Includes business development costs, personnel costs, stock-based compensation, accounting and legal fees, occupancy expense, information technology costs and interest expense.
- Consist of inter-segment sales and gross profits elimination as well as eliminations of lower of cost or market adjustments related to inter-segment inventory.
TABLE 5: PRODUCT REVENUES, SALES VOLUME, ASP
| Third Quarter | Second Quarter | Third Quarter | |||||||||
| Revenues (in thousands) | 2014 | 2014 | 2013 | ||||||||
| Resources (1) | $ | 13,933 | $ | 10,037 | $ | 13,513 | |||||
| Chemicals and Oxides (2) | 43,472 | 48,632 | 57,965 | ||||||||
| Magnetic Materials and Alloys (3) | 62,687 | 54,360 | 72,626 | ||||||||
| Rare Metals (4) | 21,269 | 15,944 | 20,994 | ||||||||
| Inter-segment eliminations | (17,424 | ) | (12,066 | ) | (16,032 | ) | |||||
| Total Net Revenues | $ | 123,937 | $ | 116,907 | $ | 149,066 | |||||
| Sales volume (in metric tons) | |||||||||||
| Resources | 1,085 | 974 | 1,080 | ||||||||
| Chemicals and Oxides | 1,651 | 1,582 | 1,696 | ||||||||
| Magnetic Materials and Alloys (a) | 1,551 | 1,383 | 1,783 | ||||||||
| Rare Metals | 104 | 79 | 102 | ||||||||
| Inter-segment eliminations | (1,035 | ) | (1,022 | ) | (1,041 | ) | |||||
| (a) Includes magnetic powders and rare earth alloys. | |||||||||||
| ASP per kilogram | |||||||||||
| Resources | $ | 12.84 | $ | 10.30 | $ | 12.51 | |||||
| Chemicals and Oxides | $ | 26.33 | $ | 30.74 | $ | 34.18 | |||||
| Magnetic Materials and Alloys | $ | 40.42 | $ | 39.31 | $ | 40.73 | |||||
| Rare Metals | $ | 204.51 | $ | 201.81 | $ | 205.82 | |||||
| 1. The Resources segment includes operations at our Mountain Pass facility where we conduct rare earth minerals extraction and processing to produce: purified unseparated light rare earth concentrates, or LREC; separated rare earth oxides, including lanthanum, cerium and neodymium/praseodymium; heavy rare earth concentrates, which include samarium, europium, gadolinium, terbium, dysprosium and others; and a line of proprietary rare earth-based water treatment products, including SorbX® and PhosFIX(TM). | |||||||||||
| 2. The Chemicals and Oxides division includes: production of rare earths at our operations at Molycorp Silmet; separated heavy rare earth oxides and other custom engineered materials from our facilities in Jiangyin, Jiangsu Province, China; and production of rare earths, salts of REEs, zirconium-based engineered materials and mixed rare earth/zirconium oxides from our facilities in Zibo, Shandong Province, China. Rare earths and zirconium applications from products made in this segment include catalytic converters, computers, television display panels, optical lenses, mobile phones, electronic chips, and many others. | |||||||||||
| 3. The Magnetic Materials and Alloys segment includes the production of Neo Powders(TM) through our wholly-owned manufacturing facilities in Tianjin, China, and Korat, Thailand, under the Molycorp Magnequench brand. This operating segment also includes manufacturing of neodymium and samarium magnet alloys, other specialty alloy products and rare earth metals at our MMA facility in Tolleson, Arizona. Neo Powders(TM) are used in the production of high performance, bonded NdFeB permanent magnets, which are found in micro-motors, precision motors, sensors, and other applications requiring high levels of magnetic strength, flexibility, small size, reduced weight, and energy efficient performance. | |||||||||||
| 4. The Rare Metals segment produces, reclaims, refines and markets high value niche metals and their compounds that include gallium, indium, rhenium, tantalum, and niobium. Operations in this segment are distributed in several locations: Quapaw, Oklahoma; Blanding, Utah; Peterborough, Ontario, Canada; Sagard, Germany; Stade, Germany; Hyeongok Industrial Zone in South Korea; and Sillamäe, Estonia. Applications from products made in this segment include wireless technologies, LEDs, flat panel displays, turbines, solar power catalysts, steel additives, electronics applications, and many others. | |||||||||||
TABLE 6: NON-GAAP ADJUSTED NET LOSS, OIBDA and ADJUSTED OIBDA RECONCILIATION
(In thousands, except shares and per share data)
| Adjusted Net Loss | |||||||||||
| Third Quarter | Second Quarter | Third Quarter | |||||||||
| 2014 | 2014 | 2013 | |||||||||
| Net loss attributable to Molycorp stockholders | $ | (105,179 | ) | $ | (83,899 | ) | $ | (69,929 | ) | ||
| Certain non-cash and other items: | |||||||||||
| Stock-based compensation | 1,496 | 1,466 | 1,687 | ||||||||
| Inventory write-downs (Mountain Pass) | 13,396 | 16,593 | 20,264 | ||||||||
| Impact of purchase accounting on cost of inventory sold | 23 | 142 | 2,151 | ||||||||
| Impairment of discontinued assets | - | - | 3,454 | ||||||||
| Out-of-ordinary items: | |||||||||||
| Water removal | 845 | 1,239 | 5,146 | ||||||||
| Income tax effect of above adjustments | (19 | ) | (49 | ) | (5,850 | ) | |||||
| Adjusted net loss | (89,438 | ) | (64,508 | ) | (43,077 | ) | |||||
| Dividends on Convertible Preferred Stock | - | - | (2,846 | ) | |||||||
| Adjusted net loss attributed to common stockholders | $ | (89,438 | ) | $ | (64,508 | ) | $ | (45,923 | ) | ||
| Weighted average common shares outstanding | 224,270,303 | 224,223,506 | 168,114,266 | ||||||||
| Adjusted net loss per share | $ | (0.40 | ) | $ | (0.29 | ) | $ | (0.27 | ) | ||
| OIBDA and Adjusted OIBDA | |||||||||||
| Third Quarter | Second Quarter | Third Quarter | |||||||||
| Consolidated | 2014 | 2014 | 2013 | ||||||||
| Operating loss | $ | (49,431 | ) | $ | (48,735 | ) | $ | (59,001 | ) | ||
| Depreciation and amortization included in costs of sales | 19,382 | 20,079 | 16,400 | ||||||||
| Depreciation, amortization and accretion | 8,093 | 7,257 | 10,072 | ||||||||
| OIBDA | (21,956 | ) | (21,399 | ) | (32,529 | ) | |||||
| Adjusted OIBDA by Segment | |||||||||||
| Resources | |||||||||||
| OIBDA | $ | (31,087 | ) | $ | (30,298 | ) | $ | (44,673 | ) | ||
| Stock-based compensation | 231 | 182 | 139 | ||||||||
| Inventory write-downs | 13,396 | 16,593 | 20,264 | ||||||||
| Water removal | 845 | 1,239 | 5,146 | ||||||||
| Adjusted OIBDA - Resources | $ | (16,615 | ) | $ | (12,284 | ) | $ | (19,124 | ) | ||
| Chemicals and Oxides | |||||||||||
| OIBDA | $ | 4,251 | $ | 4,836 | $ | 4,561 | |||||
| Stock-based compensation | 207 | 211 | 78 | ||||||||
| Impact of purchase accounting on cost of inventory sold | 23 | 142 | 555 | ||||||||
| Adjusted OIBDA - Chemicals and Oxides | $ | 4,481 | $ | 5,189 | $ | 5,194 | |||||
| Magnetic Materials and Alloys | |||||||||||
| OIBDA | $ | 13,715 | $ | 11,812 | $ | 18,520 | |||||
| Stock-based compensation | 178 | 179 | 82 | ||||||||
| Impact of purchase accounting on cost of inventory sold | - | - | (26 | ) | |||||||
| Adjusted OIBDA - Magnetic Materials and Alloys | $ | 13,893 | $ | 11,991 | $ | 18,576 | |||||
| Rare Metals | |||||||||||
| OIBDA | $ | 595 | $ | 740 | $ | (911 | ) | ||||
| Stock-based compensation | 20 | 39 | 12 | ||||||||
| Impact of purchase accounting on cost of inventory sold | - | - | 1,621 | ||||||||
| Adjusted OIBDA - Rare Metals | 615 | 779 | 722 | ||||||||
| Corporate and other | (8,151 | ) | (8,171 | ) | (5,918 | ) | |||||
| Eliminations | (419 | ) | 537 | 723 | |||||||
| Adjusted OIBDA - Consolidated | $ | (6,196 | ) | $ | (1,959 | ) | $ | 173 | |||
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ABOUT MOLYCORP
Molycorp is the only advanced material manufacturer in the world that both controls a world-class rare earth resource and can produce high-purity, custom engineered rare earth products to meet increasingly demanding customer specifications. A globally integrated manufacturer, the Company produces a wide variety of specialized products from 13 different rare earths (lights, mids and heavies), the transition metal yttrium, and five rare metals (gallium, indium, rhenium, tantalum and niobium). With 26 locations across 11 countries, Molycorp also produces rare earth magnetic materials through its Molycorp Magnequench subsidiary, including neodymium-iron-boron ("NdFeB") magnet powders, used to manufacture bonded NdFeB permanent rare earth magnets. Through its joint venture with Daido Steel and the Mitsubishi Corporation, Molycorp manufactures next-generation, sintered NdFeB permanent rare earth magnets. The Company also markets and sells a line of rare earth-based water treatment products. For more information please visit http://www.molycorp.com.
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SAFE HARBOR STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This release contains forward-looking statements that represent Molycorp's beliefs, projections and predictions about future events or Molycorp's future performance. Forward-looking statements can be identified by terminology such as "may," "will," "would," "could," "should," "expect," "intend," "plan," "anticipate," "believe," "estimate," "predict," "potential," "continue" or the negative of these terms or other similar expressions or phrases. These forward-looking statements are necessarily subjective and involve known and unknown risks, uncertainties and other important factors that could cause Molycorp's actual results, performance or achievements or industry results to differ materially from any future results, performance or achievement described in or implied by such statements.
Factors that may cause actual results to differ materially from expected results described in forward-looking statements include, but are not limited to: the need to secure additional capital to implement Molycorp's business plans, and Molycorp's ability to successfully secure any such capital, including the ability to successfully complete the Financings; Molycorp's ability to optimize production at its Mountain Pass rare earth mine and processing facility, which we refer to as the Molycorp Mountain Pass facility, and the ability to develop internal and external demand for REO and other downstream products, including the ability to operate at commercial production rates and competitive cash production costs, in each case within the projected time frame; the success of Molycorp's cost mitigation efforts in connection with the optimization of the Molycorp Mountain Pass facility, which, if unsuccessful, might cause its costs to exceed budget; the final costs of Molycorp's planned capital projects, which may differ from estimated costs; Molycorp's ability to achieve fully the strategic and financial objectives related to the acquisition of Molycorp Canada, including the acquisition's impact on Molycorp's financial condition and results of operations; unexpected costs or liabilities that may arise from the acquisition, ownership or operation of Molycorp Canada; risks and uncertainties associated with intangible assets, including any future goodwill impairment charges; market conditions, including prices and demand for Molycorp's products; Molycorp's ability to control its working capital needs; foreign exchange rate fluctuations; the development and commercialization of new products; unexpected actions of domestic and foreign governments; various events which could disrupt operations, including natural events and other risks; uncertainties associated with Molycorp's reserve estimates and non-reserve deposit information, including estimated mine life and annual production; uncertainties related to feasibility studies that provide estimates of expected or anticipated costs, expenditures and economic returns, REO prices, production costs and other expenses for operations, which are subject to fluctuation; uncertainties regarding global supply and demand for rare earths materials; uncertainties regarding the results of Molycorp's exploratory drilling programs; Molycorp's ability to enter into additional definitive agreements with its customers and its ability to maintain customer relationships; Molycorp's sintered neodymium-iron-boron rare earth magnet joint venture's ability to successfully manufacture magnets within its expected timeframe; Molycorp's ability to successfully integrate other acquired businesses; Molycorp's ability to maintain appropriate relations with unions and employees; Molycorp's ability to successfully implement its vertical integration strategy; environmental laws, regulations and permits affecting Molycorp's business, directly and indirectly, including, among others, those relating to mine reclamation and restoration, climate change, emissions to the air and water and human exposure to hazardous substances used, released or disposed of by Molycorp; and uncertainties associated with unanticipated geological conditions related to mining; and the outcome of the current stockholder class action litigation and derivative litigation, including any actions taken by government agencies in connection therewith.
For more information regarding these and other risks and uncertainties that Molycorp may face, see the section entitled "Risk Factors" of the Company's Annual Report on Form 10-K for the year ended December 31, 2013 and of the Company's Quarterly Reports on Form 10-Q. Any forward-looking statement contained in this release or the Annual Report on Form 10-K or the Quarterly Reports on Form 10-Q reflects Molycorp's current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to Molycorp's operations, operating results, growth strategy and liquidity. You should not place undue reliance on these forward-looking statements because such statements speak only as to the date when made. Molycorp assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future, except as otherwise required by applicable law.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Molycorp Inc. via Globenewswire
