VANCOUVER, British Columbia – November 3, 2016 – Tahoe Resources Inc. (“Tahoe” or the
“Company”) (TSX: THO, NYSE: TAHO) today announced strong financial and operating results
for the third quarter and first nine months of 2016, including record nine-month silver and gold
production as well as cash flow per share. Based on results to the end of September, the
Company is well positioned to achieve its full-year 2016 production and cost guidance.
Highlights of the third quarter (“Q3”) and nine-month (“Q3 YTD”) 2016 results include:
Cash flow provided by operating activities before changes in working capital of $126.0
million and $311.3 million for Q3 2016 and Q3 YTD 2016, respectively, representing $0.40
per share in Q3 2016 and a record $1.10 per share in Q3 YTD 2016.
Record quarter and nine-month revenue of $234.7 million in Q3 2016 and $595.1 million in
Q3 YTD 2016.
Net earnings of $63.0 million or $0.20 per share (basic and diluted) in Q3 2016 and $117.6
million or $0.42 per share (basic and diluted) in Q3 YTD 2016.
Adjusted earnings(1) of $65.7 million or $0.21 per share (basic and diluted) in Q3 2016 and a
record $162.0 million or $0.57 per share (basic and diluted) in Q3 YTD 2016.
Record nine month production of 16.4 million ounces silver and 265,146 ounces gold.
Q3 2016 production totaling 5.0 million ounces silver and 98,419 ounces gold.
Total cash costs per ounce(1)(2) of silver and gold of $6.50 and $625, respectively, in Q3
2016 and $5.66 and $632, respectively, in Q3 YTD 2016.
All-in sustaining costs per ounce(1)(2) (“AISC”) of silver and gold of $8.68 and $974,
respectively, in Q3 2016 and $7.55 and $979, respectively, in Q3 YTD 2016.
Dividends of $18.7 million and $50.7 million paid to shareholders in Q3 2016 and Q3 YTD
2016, respectively.
Dividend reinvestment plan implemented effective October 2016.
Total cash and cash equivalents at September 30, 2016 of $142.4 million.
(1) Example of non-GAAP measure. See Cautionary Note on Non-GAAP Financial Measures.
(2) Reported net of byproduct credits.
Ron Clayton, Tahoe’s President and CEO, commented, “We are well on the way to a record year in 2016, including achieving our key production and cost guidance. Escobal is having an outstanding year with both production and unit costs running at or better than expected levels.
Driven by our strong results at Escobal, we are on track to pay over $35 million in royalties and taxes in Guatemala in 2016, in addition to paying approximately $20 million in wages and benefits and making significant direct investments in support of nutritional programs, education, skills training, agriculture and infrastructure development in the communities surrounding the mine. We have over 1,000 employees at Escobal, 97% of whom are Guatemalan. We very much appreciate the efforts of our employees and the strong support we receive from the surrounding community.
“Turning to gold, our Bell Creek shaft project is off to an excellent start, having commenced the first vertical raise near the end of the third quarter. The shaft project is a key component of our growth program, which will add about 40,000 ounces of new production annually starting in 2018. Looking at Q3 2016 gold production, we were adversely affected by drought conditions at Shahuindo during the quarter and delayed development at the Timmins mines. These issues have been resolved and we expect to return to planned production levels in the fourth quarter.
Full-year gold production is estimated to be within our guidance range of 370,000 to 430,000 ounces.
“Looking at our financial position, our record cash flow per share and strong balance sheet position us to fund our near-term growth internally, while also sustaining one of the industry’s most attractive dividends.” 2016 Guidance
At September 30, 2016, the Company was well positioned to achieve its full-year production, cost and expenditure guidance for 2016. The Company’s guidance and related Q3 YTD 2016 performance is summarized below.
$ millions unless otherwise indicated 2016 Guidance Q3 YTD Actual
2016 Silver Production (moz) 18 – 21 16.4
2016 Gold Production (koz) 370 – 430 265
Total cash cost per silver oz produced ($) $5.50 – $6.50 $5.66
AISC per silver oz produced ($) $8.00 – $9.00 $7.55
Total cash cost per gold oz ($) $675 – $725 $632
AISC per gold oz produced ($) $950 – $1000 $979
Sustaining capital (incl. capitalized exploration) $115 – $135 $79.9
Project capital $80 – $105 $72.0
Exploration expense $15 – $20 $7.5
Corporate G&A $45 – $50 $38.0
Footnotes:
(1) See Forward-Looking Statements” and “Cautionary Note on Non-GAAP Financial Measures”.
(2) Assumes the following metals prices: $1,300/oz gold; $1,984/tonne lead; $1,984/tonne zinc.
(3) Assumes payable by-product metal production: 10,154 oz gold; 8,870 tonnes lead; 11,844 tonnes zinc.
(4) By-product credits per ounce of silver: gold $0.63; lead $0.84; zinc $1.13; total $2.60.
(5) All per ounce costs are based on silver ounces contained in concentrates (silver) and gold ounces in doré (gold).
(6) 2016 Guidance figures presented for the Escobal, La Arena and Shahuindo mines are based on a full year of production,
while figures for the Timmins Mines include nine months of production based on the April 1, 2016 date of acquisition of Lake
Shore Gold.
(7) Corporate G&A includes non-cash, stock-based compensation.
(8) Numbers may not add due to rounding.
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