Strong second quarter for SMC
For just the second time in the last five quarters the Stillwater Mining Company saw a slight profit in its second quarter report, while the recycling business continues to boom.
The profit was tiny – $800,000 – but a profit nonetheless.
The good news did not stop there.
The second quarter also brought increases in the amount of palladium and platinum mined and sold. Additionally, 169,000 ounces of recycled palladium, platinum, and rhodium were processed, making it the second highest quarter on record.
The East Boulder Mine in Sweet Grass County set several records including highest monthly tons milled in June, the highest monthly ounces per employee in June and the first half of 2016 was the highest number of ounces produced for any half-year period.
SMC also noted a substantial “safety performance improvement” with a 61.4 percent lower reportable incident rate in the second quarter, which was also the lowest quarterly rate on record.
All-in sustaining costs were down 24.3 percent from the second quarter of 2015, making it the lowest quarter since 2010.
PRODUCTION
The following are produced ounces of palladium and platinum during the second quarter:
2016 2015
Palladium 63,600 59,200
Platinum 19,500 17,600
Stillwater Total l3,100 76,800
Palladium 41,900 39,100
Platinum 12,100 11,100
East Bldr. Total 54,000 50,200
Total 137,100 127,000
RECYCLING BUSINESS CONTINUES TO BOOM
“We continue to make solid progress in growing the recycling business, processing 169,900 PGM ounces during the quarter and achieving the second best quarter on record,” said CEO Mick McMullen in a press release.
Total recycled PGM (platinum group metals) ounces fed to the smelter in Columbus were up 12.1 percent from the second quarter of 2015. The smelter saw a shift from tolled to purchased material. Tolled material comes from customers who want the metal processed and returned to them, explained SMC Investor Relations Mike Beckstead. Purchased material comes from customers who do not want the metal back. Those numbers are as follows:
2016 2015
Tons processed 2,404 2,452
Tons tolled 693 1,255
PGM oun. fed 169,900 151,600
PGM oun. sold 85,300 68,100
PGM tolled ounces returned
70,700 37,400
PGM PRICES FINALLY INCHING UPWARD
Perhaps the brightest spot in the second quarter report was the news that PGM prices are finally starting to inch back up.
“During the first half of 2016, platinum reversed its previous downward trend to reach $999 per ounce at the mid-year mark, and palladium rose from a low of $470 per ounce in the first quarter to $589 per mined ounce at the mid-year mark,” said McMullen in the press release. “At July 28, 2016, platinum traded at $1,143 per ounce and palladium had strengthened to $702 per ounce.”
ACCELERATION OF THE BLITZ PROJECT
The Blitz Project at the Nye site continues to be SMC’s priority and is being accelerated, with a new projected timeline of seeing production in late 2017.
“We anticipate Blitz will provide growth in our production profile and the Company’s lowest cost mined ounces, given the grades shown by the drilling to date, as well as the logistical set up of the Blitz project,” said McMullen.
Beckstead said the Blitz Project involves drilling along the JM Reef and continues to provide samples of higher grade. Beckstead also said that SMC anticipates production at the Blitz Project to be lower than normal.