Stillwater Mining Company Reports First Quarter 2014 Earnings

Stillwater Mining Company Reports First Quarter 2014 Earnings  BILLINGS, MT -- (Marketwired) -- 05/01/14 --   STILLWATER MINING COMPANY (NYSE: SWC) (TSX: SWC.U)      --  Consolidated net income attributable to common stockholders of $19.6     million or $0.15 per diluted share, an increase of 34.2% over the     first quarter of 2013 --  Mine production of 130,700 palladium and platinum ounces, an increase     of 2.8% over the first quarter of 2013 and within guidance range --  All-in sustaining costs of $788 per mined ounce, compared to $845 per     mined ounce for the first quarter of 2013, tracking ahead of guidance --  101,500 ounces of recycled palladium, platinum and rhodium processed,     down from 2013, primarily reflecting delays in deliveries due to     weather related issues --  Corporate overhead reduced to $10.8 million, down 53% from the first     quarter of 2013 --  Cash and highly liquid investments totaling $474.3 million at March     31, 2014     Stillwater Mining Company today reported 2014 first quarter consolidated net income attributable to common stockholders of $19.6 million or $0.15 per diluted share, compared to 2013 first quarter consolidated net income attributable to common stockholders of $14.6 million or $0.12 per diluted share. The 34.2% increase in earnings has been achieved despite realized metal prices being 2% lower than in the corresponding period of 2013, primarily reflecting the Company's cost reduction efforts.  Commenting on the first quarter results, Mick McMullen, the Company's President and Chief Executive Officer stated, "I am pleased with our start to the year. Mined production was good and within our guidance range, while costs were below guidance. There was a drop in recycling volumes in part reflecting issues with the harsh winter weather, but shipments have picked up as the weather has improved. Very importantly, our team is focusing on productivity and cost control. Our corporate overhead costs were down sharply from last year and we reported all-in sustaining costs of $788 per ounce for the quarter, which is below last year and the low end of our previous guidance range. Total capital expenditures of about $25 million were incurred, which was also below guidance. Based on these results and current forecasts we are improving our 2014 guidance for all-in sustaining costs (a non-GAAP measure) to a range of $800 to $850 per mined ounce and reducing our total cash cost per mined ounce guidance (net of credits for by-products and recycling) to a range of $530 to $570. We are also decreasing our full-year 2014 capital expenditure guidance to a range of $130 to $140 million. In addition, we have established a longer term goal to reduce our all-in sustaining cash costs per ounce by circa $100 below our 2013 results, taking our all-in sustaining costs to the low $700's per ounce."                                                                                                                                                                2014 Guidance:                                                                                                      Previous 2014        Current 2014                                              Guidance             Guidance                                          -------------------- -------------------- Mined Production (palladium and                                               platinum ounces)                    520,000 - 535,000    520,000 - 535,000  Total Cash Cost per Mined Ounce                                               (net of by-product and recycling                                             credits)                               $540 - $590          $530 - $570     All-In Sustaining Cost per Mined                                              Ounce*                                 $805 - $855          $800 - $850     Corporate Overhead(1) (millions)         $35 - $45            $35 - $45      Capital Expenditures (millions)         $145 - $155          $130 - $140       Sustaining Capital Expenditures                                               (millions)                           $97 - $103            $85 - $90        Project Capital Expenditures                                                  (millions)                            $48 - $52            $45 - $50         *All-in sustaining cost per mined ounce guidance for 2014 assumes the exclusion of a $30 per ounce recycling credit and $20 per ounce of costs for foreign activities.  (1) Corporate Overhead includes: general and administrative, marketing, research and development and exploration expenses.  For the first quarter of 2014, the Company's Montana mines produced a total of 130,700 ounces of palladium and platinum, a 2.8% increase compared to mine production of 127,100 ounces in the first quarter of 2013. The 18.8% increase in East Boulder Mine production in this year's first quarter compared to the first quarter of 2013 was driven by slightly higher realized ore grades and higher tons mined. The 3.0% decline in ounces produced at the Stillwater Mine reflected lower ore tons mined and increased allocation of resources to development activities during the 2014 first quarter compared to the first quarter of 2013.                                                                                                                                                                2014 Mine Production Comparison by Quarter:                                                                       2014 First   2013 First    Percentage   (Produced ounces)                      Quarter      Quarter       Change                                         ------------ ------------ -------------- Stillwater Mine                           89,700       92,600         (3.1)%   Palladium                               68,900       71,300         (3.4)%   Platinum                                20,800       21,300         (2.3)% East Boulder Mine                         41,000       34,500         18.8%    Palladium                               31,900       26,800         19.0%    Platinum                                 9,100        7,700         18.2%  Total                                    130,700      127,100          2.8%    Palladium                              100,800       98,100          2.8%    Platinum                                29,900       29,000          3.1%     Revenue from the Company's Mine Production segment for the first quarter of 2014 (including proceeds from the sale of by-products) totaled $125.7 million, a 2.0% decrease from $128.3 million in the same period of 2013. Combined sales realizations for mined palladium and platinum decreased for the first quarter of 2014, averaging $907 per mined ounce, compared to $926 per mined ounce realized in the first quarter of 2013. The total quantity of mined palladium and platinum ounces sold in the first quarter of 2014 was 131,300 ounces compared to 130,400 ounces sold in the same period of 2013. As a result of earlier constraints on reprocessing slag inventories at the Stillwater Mine, the Company now expects the benefit of PGMs resident in its slag inventories at the end of 2013 to be realized in second quarter 2014 sales.  The Company processed recycling material containing 101,500 ounces of palladium, platinum and rhodium through its smelter and refinery during the first quarter of 2014. This represents a decrease of 34.2% over the total of 154,200 ounces processed during the first quarter of 2013. As noted, the decrease in recycling volumes during the first quarter of 2014 was primarily due to weather related issues. Recycling material deliveries have increased subsequent to the end of the first quarter as overall weather conditions have improved.                                                                                                                                                                2014 Recycling Ounces Fed Comparison by Quarter:                                                           2014 First      2013 First                                                    Quarter         Quarter     Percentage Change                            --------------- --------------- ----------------- Total                              101,500         154,200           (34.2)%   Palladium                         57,600          89,200           (35.4)%   Platinum                          36,300          52,800           (31.3)%   Rhodium                            7,600          12,200           (37.7)%    Recycling sales volumes for the first quarter of 2014 decreased by 20.0%, to 93,500 ounces from 116,900 ounces sold in the first quarter of 2013. PGM Recycling revenue totaled $93.5 million for the 2014 first quarter, a 23.5% decrease from $122.3 million in the same period of 2013. The Company's combined average realized price for sales of recycled palladium, platinum and rhodium decreased by 6% to $980 per ounce in the first quarter of 2014 from $1,043 per ounce in the first quarter of 2013.  Combined total cash costs per mined ounce, net of by-product and recycling credits, (a non-GAAP measure) averaged $568 per ounce for the quarter ended March 31, 2014. See - "Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues." The table below illustrates the effect of by-product and recycling credits on the total cash costs per mined ounce net of credits for the combined Montana mining operations.                                                                                                                                                                                                                             2014     2013   Combined Montana Mining Operations                           First    First  Cash Costs Per Mined Ounce                                  Quarter  Quarter                                                            -------- -------- Reported Total Cash Costs per Mined Ounce (Net of Credits)                    *                                                         $    568 $    523   Add: By-Product Revenue Credit                                 51       59   Add: PGM Recycling Income Credit                               24       47                                                            -------- -------- Total Cash Costs per Mined Ounce (Before Credits) *        $    643 $    629                                                            ======== ========    * These are non-GAAP measures. For a full description and reconciliation of these and other non-GAAP measures to GAAP accounting measures, see Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues below.  The Company is also utilizing another, broader non-GAAP measure of mining efficiency, All-in Sustaining Cost, in monitoring and managing its performance going forward. This non-GAAP measure starts with total cash costs net of credits and adds back the recycling credit, plus U.S. corporate general and administrative costs (before depletion, depreciation and amortization) and capital outlays directed toward sustaining operations at the Company's operating mines. The resulting measure provides a comparative indication of the all-in resources consumed in any period to sustain the mining operations and produce at current levels.                                                                                                                                                                                                                             2014     2013   Combined Montana Mining Operations                           First    First  All-In Sustaining Cost Per Mined Ounce                      Quarter  Quarter                                                            -------- -------- Reported Total Cash Costs per Mined Ounce (Net of Credits)                    *                                                         $    568 $    523 Add: PGM Recycling Income Credit                                 24       47 Add: Corporate General & Administrative Costs (Before                         DD&A)                                                           59      121 Add: Capital Outlays to Sustain Production at the Montana                     Operating Mines                                                137      154                                                            -------- -------- All-In Sustaining Cost per Mined Ounce                     $    788 $    845                                                            ======== ========    * These are non-GAAP measures. For a full description and reconciliation of these and other non-GAAP measures to GAAP accounting measures, see Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues below.  Cash Flow and Liquidity  At March 31, 2014, the Company's consolidated available cash balance was $224.6 million, compared to $286.7 million at December 31, 2013. If highly liquid investments are included with available cash, the Company's balance sheet liquidity totaled $474.3 million at March 31, 2014, a decrease from $496.0 million at December 31, 2013. Essentially all of this decline in total balance sheet liquidity was attributable to a $19.9 million increase in accounts receivable at quarter end, reflecting a larger than normal share of sales revenue that was not collected until the first week of April. Of the Company's first quarter consolidated cash balance, $20.4 million is dedicated to the Marathon project (and other related Canadian properties) and is unavailable for other corporate purposes. Net working capital -- comprised of total current assets (including available cash and investments), less current liabilities -- increased to $628.0 million at March 31, 2014, from $614.8 million at the end of 2013.  Net cash provided by operating activities (which includes changes in working capital) totaled $4.8 million for the quarter ended March 31, 2014, compared to $15.5 million of cash provided for the same period of 2013. As noted above, most of this working capital change reflects the growth in accounts receivable resulting from the mix of customers paying during the first week of April instead of the last week of March. Capital expenditures, adjusted to a cash basis, were $26.1 million for the quarter ended March 31, 2014, compared to $29.4 million in the same period of 2013.  Outstanding debt at March 31, 2014, was $314.3 million, up from $310.7 million at December 31, 2013. The Company's reported debt balance currently includes approximately $278.2 million of 1.75% convertible debentures (net of unamortized discount of $118.6 million) and $2.2 million of 1.875% convertible debentures, $29.6 million of exempt facility revenue bonds, a capital lease of $4.1 million and approximately $0.2 million of financing for a small installment land purchase. The increase in the debt balance during 2014 is attributable to the accretion of the discount on the Company's outstanding bonds.  Other Matters  The Company continues to focus heavily on the efficient allocation of resources, with numerous initiatives underway to arrest and reduce rising costs experienced historically. Examples include evaluating more efficient alternatives for transporting employees and materials within the expanding underground mine infrastructure, improving material procurement methods to ensure the lowest costs are achieved and assessing the economics of the various mining areas to ensure each ounce of production is profitable. During 2014 the Company has initiated a restructuring process that has impacted positions at various levels within the organization. This restructuring was initiated as part of the ongoing effort to ensure a long-term sustainable business. Positions at the Company's Montana operations and at its Marathon and Altar project locations in Canada and Argentina, respectively, were affected. This action included the reduction of 48 salaried personnel and the opportunity for up to an additional 50 voluntary separations for the hourly workforce. As a result, it is estimated that restructuring costs of $4.3 million will be recognized in the second quarter of 2014 for the salaried positions and additional expenses associated with the voluntary separations that have not been finalized at this time.  The Company has scaled back its activities at Altar, its copper-gold prospect in Argentina, while determining how best to realize value from the property going forward. In the meantime, the Company is maintaining a minimum level of activity that permits it to retain its interest in the Altar concessions while limiting spending to essential services. The Company recently reached an agreement with IPEEM, the Argentine entity that granted the Rio Cenicero mineral leases at Altar, to renew the Company's exploration concessions there through August 2015.  The Company owns a 75% interest in the Marathon PGM-copper project and related properties in Canada. Mitsubishi Corporation owns the remaining 25%. As announced during the first quarter of this year, it has become clear that at current PGM and copper prices, the project as presently conceived would not provide an acceptable economic rate of return for shareholders. The Company and its partner are examining various alternatives to enhance project returns. However, at this time there is no assurance that these alternatives will provide the economic improvement to make the project viable. Several of these changes, if implemented, could result in changes to the project scope that are not contemplated in the current economic assessment process. Consequently, the Company agreed with the joint environmental review panel that is addressing the Marathon project to suspend the review process until there is further clarity as to the direction of the project. The Company is maintaining its position at Marathon and looking for opportunities to realize value there in the future. However, until such time as the project is able to demonstrate viable economics, the Company is scaling back spending on the Marathon project.  First Quarter Results - Details  For the first quarter of 2014, the Company's Stillwater Mine produced 89,700 ounces of palladium and platinum, a decrease of 3.1% from the 92,600 ounces produced in the first quarter of 2013. Production at the Company's East Boulder Mine of 41,000 ounces in the first quarter of 2014 reflected an increase of 18.8% over the 34,500 ounces produced in the same quarter of 2013.  Costs of metals sold (before depletion, depreciation and amortization expense) decreased to $168.8 million in the first quarter of 2014 from $192.6 million in the first quarter of 2013. Mine Production costs included in costs of metals sold increased to $78.0 million in the 2014 first quarter from $75.8 million in the 2013 first quarter. PGM Recycling costs, which primarily reflect the cost of acquiring spent catalytic materials for processing, totaled $90.7 million in the first quarter of 2014, down from the $116.9 million reported in the first quarter of 2013.  General and administrative costs were $9.6 million in the first quarter of 2014, down from the $15.2 million incurred during the same period of 2013. The higher G&A costs in the first quarter of 2013 reflected additional legal and advisory fees of approximately $2.8 million in connection with the proxy contest as well as higher compensation benefits of approximately $2.0 million. Exploration expenses were $1.0 million in the first quarter of 2014 compared to $6.0 million in the same period of 2013 as a result of steps taken to scale back exploration at the Altar and Marathon projects. Marketing expenses declined to $0.2 million in the 2014 first quarter compared to $1.7 million in the same quarter of 2013, reflecting the curtailment of palladium jewelry marketing efforts.  Interest expense reported for the first quarter of 2014 and 2013 was $5.9 million and $6.7 million, respectively. This decrease is due in part to the paying down on the outstanding debt associated with the 1.875% convertible early in the first quarter of 2013, offset in part by interest expense related to the 1.75% convertible debentures, including the accretion of the debt discount that is charged to earnings over the expected life of the convertible debentures. Interest expense also is reduced by capitalized interest accrued on the Company's ongoing projects.  During the first quarter of 2014, the Company recorded a net foreign currency transaction gain of $4.2 million, primarily related to the deferred tax liability recorded in association with the acquisition of Peregrine Metals Ltd. The net foreign currency transaction gain recorded for the first quarter of 2013 was flat with the current year's first quarter at $4.2 million.  2014 First Quarter Results Webcast and Conference Call  Stillwater Mining Company will conduct a conference call to discuss first quarter 2014 results at 12:00 noon Eastern Standard Time on Thursday, May 1, 2014.  Dial-In Numbers:  United States: (877) 531-2988  International: (612) 332-0718  The conference call will be simultaneously webcast through the Company's website at www.stillwatermining.com in the Investor Relations section.  A telephone replay of the call will be available for one week following the event. The replay dial-in numbers are (800) 475-6701 (U.S.) and (320) 365-3844 (International), access code 324973. In addition, the call transcript will be archived in the Investor Relations section of the Company's website.  About Stillwater Mining Company  Headquartered in Billings, Montana, Stillwater Mining Company is the only U.S. producer of platinum group metals (PGMs) and the largest primary producer of PGMs outside of South Africa and the Russian Federation. PGMs are rare precious metals used in a wide variety of applications, including auto catalysts, fuel cells, hydrogen purification, electronics, jewelry, dentistry, medicine, coinage and other applications. Stillwater Mining Company is engaged in the development, extraction, processing, smelting and refining of PGMs from a geological formation in southern Montana known as the J-M Reef and from the recycling of spent catalytic converters. The J-M Reef is the only known significant source of PGMs in the United States and the highest-grade PGM resource in the world. The Company also owns the Marathon PGM-copper deposit in Ontario, Canada, and the Altar porphyry copper-gold deposit located in the San Juan province of Argentina. The Company's shares are traded on the New York Stock Exchange under the symbol SWC and on the Toronto Stock Exchange under the symbol SWC.U. Information about Stillwater Mining Company can be found at its website: www.stillwatermining.com.  Some statements contained in this report are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (Securities Act), and Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act), and, therefore, involve uncertainties or risks that could cause actual results to differ materially. These statements may contain words such as "believes," "anticipates," "plans," "expects," "intends," "estimates" or similar expressions. Such statements also include, but are not limited to, comments regarding expansion plans, costs, grade, production and recovery rates; permitting; financing needs and the terms of future credit facilities; exchange rates; capital expenditures; increases in processing capacity; cost reduction measures; safety; timing for engineering studies; environmental permitting and compliance; litigating; labor matters; and the palladium, platinum, copper and gold market. The forward-looking statements in this report are based on assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions, expected future developments, and other factors that we believe are appropriate under the circumstances. These statements are not guarantees of the Company's future performance and are subject to risks, uncertainties and other important factors that could cause its actual performance or achievements to differ materially from those expressed or implied by these forward-looking statements. Additional information regarding factors that could cause results to differ materially from management's expectations is found in the section entitled "Risk Factors" in the Company's 2013 Annual Report on Form 10-K, in its quarterly Form 10-Q filings, and in corresponding filings with Canadian securities regulatory authorities.  The Company intends that the forward-looking statements contained herein be subject to the above-mentioned statutory safe harbors. Investors are cautioned not to rely on forward-looking statements. The Company disclaims any obligation to update forward-looking statements.                                                                                                                                                                Stillwater Mining Company                                                    Consolidated Statements of Comprehensive Income                              (Unaudited)                                                                                                                                                                                                         Three Months Ended                                                               March 31,                                                               ------------------- (In thousands, except per share data)                      2014      2013                                                             --------- --------- REVENUES                                                                       Mine Production                                        $125,729  $128,314    PGM Recycling                                            93,535   122,334    Other                                                       235         -                                                           --------- ---------     Total revenues                                        219,499   250,648  COSTS AND EXPENSES                                                             Costs of metals sold                                                           Mine Production                                        77,992    75,753      PGM Recycling                                          90,706   116,862      Other                                                      79         -                                                           --------- ---------       Total costs of metals sold (excludes depletion,                               depreciation and amortization)                     168,777   192,615    Depletion, depreciation and amortization                                       Mine Production                                        14,910    15,025      PGM Recycling                                             241       258                                                           --------- ---------       Total depletion, depreciation and amortization       15,151    15,283                                                           --------- ---------         Total costs of revenues                           183,928   207,898    Marketing                                                   151     1,727    Exploration                                               1,046     5,951    Research and development                                     31        63    General and administrative                                9,604    15,187    Loss on long-term investments                                 -       562    (Gain)/loss on disposal of property, plant and                                equipment                                                 (238)       36                                                           --------- ---------         Total costs and expenses                          194,522   231,424  OPERATING INCOME                                           24,977    19,224  OTHER INCOME (EXPENSE)                                                         Other                                                        33     1,145    Interest income                                             825     1,200    Interest expense                                         (5,850)   (6,652)   Foreign currency transaction gain, net                    4,179     4,237                                                           --------- --------- INCOME BEFORE INCOME TAX PROVISION                         24,164    19,154    Income tax provision                                     (5,125)   (4,850)                                                          --------- --------- NET INCOME                                               $ 19,039  $ 14,304                                                           --------- --------- Net loss attributable to noncontrolling interest             (533)     (279)                                                          --------- --------- NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS           $ 19,572  $ 14,583                                                           --------- --------- Other comprehensive (loss) income, net of tax                                  Net unrealized (losses)/gains on investments                                  available-for-sale                                         (37)       74                                                           --------- --------- COMPREHENSIVE INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS $ 19,535  $ 14,657                                                           --------- --------- Comprehensive loss attributable to noncontrolling                             interest                                                    (533)     (279)                                                                  -         - TOTAL COMPREHENSIVE INCOME                               $ 19,002  $ 14,378                                                           ========= ========= Weighted average common shares outstanding                                     Basic                                                   119,608   117,433    Diluted                                                 155,754   159,695  Basic earnings per share attributable to common                               stockholders                                            $   0.16  $   0.12  Diluted earnings per share attributable to common                             stockholders                                            $   0.15  $   0.12                                                           ========= =========                                                                                                                                                                                                                                        Stillwater Mining Company                                                    Consolidated Balance Sheets                                                  (Unaudited)                                                                                                                                                                                                       March      December  (In thousands, except per share data)                  31, 2014    31, 2013                                                       ----------- ----------- ASSETS                                                                       Current assets                                                               Cash and cash equivalents                            $  224,624  $  286,687  Investments, at fair market value                       249,630     209,338  Inventories                                             165,336     158,650  Trade receivables                                        28,871       8,988  Deferred income taxes                                    18,855      21,547  Prepaids                                                  1,873       3,912  Other current assets                                     19,993      14,757                                                       ----------- -----------     Total current assets                                709,182     703,879  Mineral properties                                      159,252     159,252  Mine development, net                                   357,676     346,346  Property, plant and equipment, net                      121,421     124,731  Deferred debt issuance costs                              7,581       7,945  Other noncurrent assets                                   3,738       4,527                                                       ----------- -----------     Total assets                                     $1,358,850  $1,346,680                                                       =========== =========== LIABILITIES AND EQUITY                                                       Current liabilities                                                          Accounts payable                                     $   21,668  $   32,088  Accrued compensation and benefits                        29,486      30,646  Property, production and franchise taxes payable         12,867      14,495  Current portion of long-term debt and capital lease                           obligations                                              2,062       2,035  Income taxes payable                                      6,099       4,416  Other current liabilities                                 8,967       5,368                                                       ----------- -----------     Total current liabilities                            81,149      89,048    Long-term debt and capital lease obligations          312,245     308,667    Deferred income taxes                                  70,099      79,159    Accrued workers compensation                            5,998       6,031    Asset retirement obligation                             8,835       8,654    Other noncurrent liabilities                            9,960       7,262                                                       ----------- -----------     Total liabilities                                   488,286     498,821                                                       ----------- ----------- EQUITY                                                                       Stockholders' equity                                                         Preferred stock, $0.01 par value, 1,000,000 shares                            authorized; none issued                                      -           -  Common stock, $0.01 par value, 200,000,000 shares                             authorized; 119,726,425 and 119,466,449 shares                               issued and outstanding                                   1,197       1,195  Paid-in capital                                       1,079,901   1,076,200  Accumulated deficit                                    (229,864)   (249,436) Accumulated other comprehensive (loss) income               (31)          6                                                       ----------- -----------     Total stockholders' equity                          851,203     827,965                                                       ----------- ----------- Noncontrolling interest                                  19,361      19,894                                                       ----------- -----------     Total equity                                        870,564     847,859                                                       ----------- -----------     Total liabilities and equity                     $1,358,850  $1,346,680                                                       =========== ===========                                                                                                                                                                                                                                        Stillwater Mining Company                                                    Consolidated Statements of Cash Flows                                        (Unaudited)                                                                                                                                                                                                       Three Months Ended                                                               March 31,                                                             ----------------------- (In thousands)                                          2014        2013                                                          ----------- ----------- CASH FLOWS FROM OPERATING ACTIVITIES                                         Net income                                           $   19,039  $   14,304  Adjustments to reconcile net income to net cash                               provided by operating activities:                                             Depletion, depreciation and amortization               15,151      15,283    (Gain)/Loss on disposal of property, plant and                                equipment                                               (238)         36    Loss on long-term investments                               -         562    Amortization/accretion on investment                                          premium/discount                                         574         885    Deferred taxes                                         (2,131)      1,830    Foreign currency transaction gain, net                 (4,179)     (4,237)   Accretion of asset retirement obligation                  181         167    Amortization of debt issuance costs                       364         557    Accretion of convertible debenture debt discount        4,170       3,832    Share based compensation and other benefits             3,180       4,246    Non-cash capitalized interest                            (679)       (422) Changes in operating assets and liabilities:                                   Inventories                                            (6,133)    (34,017)   Trade receivables                                     (19,883)     (4,350)   Prepaids                                                2,039         665    Accrued compensation and benefits                      (1,164)       (780)   Accounts payable                                       (7,579)     11,567    Property, production and franchise taxes payable        1,070       1,612    Income taxes payable                                    1,683         669    Workers compensation                                      (33)        384    Other operating assets                                 (4,234)      1,346    Other operating liabilities                             3,567       1,363                                                       ----------- ----------- NET CASH PROVIDED BY OPERATING ACTIVITIES                 4,765      15,502                                                       ----------- ----------- CASH FLOWS FROM INVESTING ACTIVITIES                                           Capital expenditures                                  (26,133)    (29,406)   Proceeds from disposal of property, plant and                                 equipment                                                259          19    Purchases of investments                              (76,352)    (21,996)   Proceeds from maturities of investments                35,419      24,025                                                       ----------- ----------- NET CASH USED IN INVESTING ACTIVITIES                   (66,807)    (27,358)                                                      ----------- ----------- CASH FLOWS FROM FINANCING ACTIVITIES                                           Payments on debt and capital lease obligations           (557)   (164,787)   Issuance of common stock                                  536          56                                                       ----------- ----------- NET CASH USED IN FINANCING ACTIVITIES                       (21)   (164,731)                                                      ----------- ----------- CASH AND CASH EQUIVALENTS                                                      Net decrease                                          (62,063)   (176,587)   Balance at beginning of period                        286,687     379,680                                                       ----------- ----------- BALANCE AT END OF PERIOD                             $  224,624  $  203,093                                                       =========== ===========                                                                                                                                                                                                                                        Stillwater Mining Company                                                    Key Operating Factors                                                        (Unaudited)                                                                                                                                                                                                             Three Months                                                                Ended March 31,                                                             ---------------- (In thousands, except where noted)                            2014    2013                                                               ------- -------- OPERATING AND COST DATA FOR MINE PRODUCTION                                  Consolidated:                                                                Ounces produced                                                              Palladium                                                       101       98 Platinum                                                         30       29                                                             ------- -------- Total                                                           131      127                                                             ======= ======== Tons milled                                                     277      293 Mill head grade (ounce per ton)                                0.50     0.46 Sub-grade tons milled (1)                                        18       20 Sub-grade tons mill head grade (ounce per ton)                 0.19     0.16 Total tons milled(1)                                            295      313 Combined mill head grade (ounce per ton)                       0.48     0.44 Total mill recovery (%)                                          92       92 Total mine concentrate shipped (tons) (3)                     7,301    7,160 Platinum grade in concentrate (ounce per ton) (3)              4.70     4.30 Palladium grade in concentrate (ounce per ton) (3)            14.93    14.27 Total cash costs per ounce - net of credits (Non-GAAP) (2)  $   568 $    523 Total cash costs per ton milled - net of credits (Non-GAAP)                   (2)                                                        $   251 $    213 Stillwater Mine:                                                             Ounces produced                                                              Palladium                                                        69       71 Platinum                                                         21       21                                                             ------- -------- Total                                                            90       92                                                             ======= ======== Tons milled                                                     170      192 Mill head grade (ounce per ton)                                0.56     0.51 Sub-grade tons milled (1)                                         8       10 Sub-grade tons mill head grade (ounce per ton)                 0.28     0.21 Total tons milled (1)                                           178      202 Combined mill head grade (ounce per ton)                       0.55     0.49 Total mill recovery (%)                                          93       93 Total mine concentrate shipped (tons) (3)                     4,395    4,308 Platinum grade in concentrate (ounce per ton) (3)              5.56     5.22 Palladium grade in concentrate (ounce per ton) (3)            17.19    17.09 Total cash costs per ounce - net of credits (Non-GAAP) (2)  $   546 $    498 Total cash costs per ton milled - net of credits (Non-GAAP)                   (2)                                                        $   275 $    229                                                                                                                                                                                                                                           Stillwater Mining Company                                                    Key Operating Factors (Continued)                                            (Unaudited)                                                                                                                                                                                                         Three Months Ended                                                                March 31,                                                               ------------------ (In thousands, except where noted)                          2014      2013                                                             --------  -------- OPERATING AND COST DATA FOR MINE PRODUCTION (Continued)                      East Boulder Mine:                                                           Ounces produced                                                              Palladium                                                       32        27 Platinum                                                         9         8                                                           --------  -------- Total                                                           41        35                                                           ========  ======== Tons milled                                                    107       101 Mill head grade (ounce per ton)                               0.41      0.37 Sub-grade tons milled (1)                                       10        10 Sub-grade tons mill head grade (ounce per ton)                0.11      0.11 Total tons milled (1)                                          117       111 Combined mill head grade (ounce per ton)                      0.39      0.34 Total mill recovery (%)                                         90        90 Total mine concentrate shipped (tons) (3)                    2,906     2,852 Platinum grade in concentrate (ounce per ton) (3)             3.41      2.93 Palladium grade in concentrate (ounce per ton) (3)           11.52     10.00 Total cash costs per ounce - net of credits (Non-GAAP)                        (2)                                                      $    614  $    590 Total cash costs per ton milled - net of credits (Non-                        GAAP) (2)                                                $    215  $    184                                                                              (1) Sub-grade tons milled includes reef waste material only. Total tons          milled includes ore tons and sub-grade tons only. See "Proven and            Probable Ore Reserves - Discussion" in the Company's 2013 Annual Report      on Form 10-K for further information.                                                                                                                 (2) Total cash costs include total operating costs plus royalties, insurance     and taxes other than income taxes. Income taxes, corporate general and       administrative expenses, asset impairment write-downs, gain or loss on       disposal of property, plant and equipment, restructuring costs and           interest income and expense are not included in total cash costs. Cash       costs per ton and cash costs per ounce, are non-GAAP measurements that       management uses to monitor and evaluate the efficiency of its mining         operations. These measures of cost are not defined under U.S. Generally      Accepted Accounting Principles (GAAP). Please see "Reconciliation of         Non-GAAP Measures to Consolidated Costs of Revenues" and the                 accompanying discussion for additional detail.                                                                                                        (3) The concentrate tonnage and grade values are inclusive of periodic re-       processing of smelter slag and brick PGM bearing materials.                                                                                                                                                                                                                                                     Stillwater Mining Company                                                    Key Operating Factors (Continued)                                            (Unaudited)                                                                                                                                                                                                        Three Months Ended                                                               March 31,       (In thousands, except for average prices)                 2014       2013                                                           ---------- ---------- SALES AND PRICE DATA                                                         Ounces sold                                                                  Mine Production:                                                               Palladium (oz.)                                             100        101   Platinum (oz.)                                               31         29                                                        ---------- ----------     Total                                                     131        130                                                        ---------- ---------- PGM Recycling: (1)                                                             Palladium (oz.)                                              54         66   Platinum (oz.)                                               32         42   Rhodium (oz.)                                                 8          9                                                        ---------- ----------     Total                                                      94        117                                                        ---------- ---------- By-products from Mine Production: (2)                                          Rhodium (oz.)                                                 1          1   Gold (oz.)                                                    3          2   Silver (oz.)                                                  2          2   Copper (lb.)                                                176        214   Nickel (lb.)                                                365        339 Average realized price per ounce (3)                                         Mine Production:                                                               Palladium ($/oz.)                                    $      743 $      725   Platinum ($/oz.)                                     $    1,431 $    1,628     Combined ($/oz.)(4)                                $      907 $      926 PGM Recycling: (1)                                                             Palladium ($/oz.)                                    $      729 $      674   Platinum ($/oz.)                                     $    1,410 $    1,607   Rhodium ($/oz.)                                      $      857 $    1,122     Combined ($/oz.)(4)                                $      980 $    1,043 By-products from Mine Production: (2)                                          Rhodium ($/oz.)                                      $    1,060 $    1,200   Gold ($/oz.)                                         $    1,295 $    1,622   Silver ($/oz.)                                       $       21 $       30   Copper ($/lb.)                                       $     3.05 $     3.39   Nickel ($/lb.)                                       $     5.81 $     6.43 Average market price per ounce (3)                                             Palladium ($/oz.)                                    $      745 $      739   Platinum ($/oz.)                                     $    1,429 $    1,634     Combined ($/oz.)(4)                                $      908 $      939                                                                              (1) Ounces sold and average realized price per ounce from PGM Recycling          relate to ounces produced from processing of catalyst materials.                                                                                      (2) By-product metals sold reflect contained metal produced from mined ore       alongside the Company's primary production of palladium and platinum.        Realized prices reflect net values (discounted due to product form and       transportation and marketing charges) per unit received.                                                                                              (3) The Company's average realized price represents revenues, which include      the effect of hedging gains and losses realized on commodity instruments     and agreement discounts, divided by ounces sold. The average market          price represents the average London Bullion Market Association afternoon     postings for the actual months of the period.                                                                                                         (4) The Company calculates the combined average realized and a combined          average market price of palladium and platinum using the same ratio as       the rate of ounces of each respective metal that are produced from the       base metal refinery.                                                        Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues  The Company utilizes certain non-GAAP measures as indicators in assessing the performance of its mining and processing operations during any period. Because of the processing time required to complete the extraction of finished PGM products, there are typically lags of one to three months between ore production and sale of the finished product. Sales in any period include some portion of material mined and processed from prior periods as the revenue recognition process is completed. Consequently, while costs of revenues (a GAAP measure included in the Company's Consolidated Statements of Comprehensive Income) appropriately reflects the expense associated with the materials sold in any period, the Company has developed certain non-GAAP measures to assess the costs associated with its producing and processing activities in a particular period and to compare those costs between periods.  While the Company believes that these non-GAAP measures may also be of value to outside readers, both as general indicators of the Company's mining efficiency from period to period and as insight into how the Company internally measures its operating performance, these non-GAAP measures are not standardized across the mining industry and in most cases will not be directly comparable to similar measures that may be provided by other companies. These non-GAAP measures are only useful as indicators of relative operational performance in any period, and because they do not take into account the inventory timing differences that are included in costs of revenues, they cannot meaningfully be used to develop measures of earnings or profitability. A reconciliation of these measures to costs of revenues, the most comparable measure under GAAP, for each period shown is provided as part of the following tables, and a description of each non-GAAP measure is provided below.  Total Consolidated Costs of Revenues: For the Company as a whole, this measure is equal to total costs of revenues, as reported in the Consolidated Statements of Comprehensive Income. For the Stillwater Mine, the East Boulder Mine, and other PGM activities, the Company segregates the expenses within total costs of revenues that are directly associated with each of these activities and then allocates the remaining facility costs included in total cost of revenues in proportion to the monthly volumes from each activity. The resulting total costs of revenues measures for the Stillwater Mine, the East Boulder Mine and other PGM activities are equal in total to total consolidated costs of revenues as reported in the Company's Consolidated Statements of Comprehensive Income.  Total Cash Costs (Non-GAAP): This non-GAAP measure is calculated as total costs of revenues (for each mine or combined) adjusted to exclude gains or losses on asset dispositions, costs and profit from recycling activities, revenues from the sale of mine by-products, depreciation and amortization and asset retirement costs, and timing differences resulting from changes in product inventories. The Company uses this measure as a comparative indication of the cash costs related to production and processing operations in any period. It is a measure of extraction efficiency.  When divided by the total tons milled in the respective period, Total Cash Cost per Ton Milled (Non-GAAP) -- measured for each mine or combined -- provides an indication of the level of cash costs incurred per ton milled in that period. Because of variability of ore grade in the Company's mining operations, production efficiency underground is frequently measured against ore tons produced rather than contained PGM ounces. Because ore tons are first weighed as they are fed into the mill, mill feed is the first point at which production tons are measured precisely. Consequently, Total Cash Cost per Ton Milled (Non-GAAP) is a general measure of production efficiency, and is affected both by the level of Total Cash Costs (Non-GAAP) and by the volume of tons produced and fed to the mill.  When divided by the total recoverable PGM ounces from production in the respective period, Total Cash Cost per Ounce (Non-GAAP) -- measured for each mine or combined -- provides an indication of the level of cash costs incurred per PGM ounce produced in that period. Recoverable PGM ounces from production are an indication of the amount of PGM product extracted through mining in any period. Because ultimately extracting PGM material is the objective of mining, the cash cost per ounce of extracting and processing PGM ounces in a period is a useful measure for comparing extraction efficiency between periods and between the Company's mines. Consequently, Total Cash Cost per Ounce (Non-GAAP) in any period is a general measure of extraction efficiency, and is affected by the level of Total Cash Costs (Non-GAAP), by the grade of the ore produced and by the volume of ore produced in the period.                                                                                                                                                                Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues         (Unaudited)                                                                                                                         Three Months Ended                                                               March 31,                                                             ----------------------- (In thousands, except per ounce and per ton data)       2014        2013                                                          ----------  ----------  Consolidated:                                                                Total cash cost before by-product and recycling                               credits (Non-GAAP)                                  $   84,051  $   80,023  Less: By-product credit                                  (6,681)     (7,509) Less: Recycling income credit                            (3,167)     (6,032)                                                      ----------  ----------  Total cash cost net of by-product and recycling                               credits (Non-GAAP)                                  $   74,203  $   66,482                                                                               Divided by platinum/palladium ounces produced               131         127                                                                               Total cash cost before by-product and recycling                               credits per ounce Pt/Pd produced (Non-GAAP)         $      643  $      629  Less: By-product credit per ounce Pt/Pd produced            (51)        (59) Less: Recycling income credit per ounce Pt/Pd                                 produced                                                   (24)        (47)                                                      ----------  ----------  Total cash cost net of by-product and recycling                               credits per ounce Pt/Pd produced (Non-GAAP)         $      568  $      523                                                                               Divided by ore tons milled                                  295         313                                                                               Total cash cost before by-product and recycling                               credits per ore ton milled (Non-GAAP)               $      285  $      256  Less: By-product credit per ore ton milled                  (23)        (24) Less: Recycling income credit per ore ton milled            (11)        (19)                                                      ----------  ----------  Total cash cost net of by-product and recycling                               credits per ore ton milled (Non-GAAP)               $      251  $      213                                                                               Reconciliation to consolidated costs of revenues:                            Total cash cost net of by-product and recycling                               credits (Non-GAAP)                                  $   74,203  $   66,482  Asset retirement costs                                      181         167  Depletion, depreciation and amortization                 14,910      15,025  Depletion, depreciation and amortization (in                                  inventory)                                                 553        (753) Change in product inventories                            (6,714)     (3,683) Cost of PGM Recycling                                    90,706     116,862  PGM Recycling - depreciation                                241         258  By-product credit                                         6,681       7,509  Profit from PGM Recycling (before bad debt expense                            and gain/loss on asset disposals)                        3,167       6,031                                                       ----------  ----------  Total consolidated cost of revenues                  $  183,928  $  207,898                                                       ==========  ==========  Memo: Royalties, Taxes and Other included in Total                            consolidated cost of revenues                       $   12,013  $   11,692                                                                                                                                                                                                                                         Stillwater Mining Company                                                    Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues         (Continued)                                                                  (Unaudited)                                                                                                                                                                                                      Three Months Ended                                                               March 31,                                                             ----------------------- (In thousands, except per ounce and per ton data)       2014        2013                                                          ----------  ----------  Stillwater Mine:                                                             Total cash cost before by-product and recycling                               credits (Non-GAAP)                                  $   55,228  $   55,205  Less: By-product credit                                  (4,016)     (4,665) Less: Recycling income credit                            (2,170)     (4,397)                                                      ----------  ----------  Total cash cost net of by-product and recycling                               credits (Non-GAAP)                                  $   49,042  $   46,143                                                                               Divided by platinum/palladium ounces produced                90          93                                                                               Total cash cost before by-product and recycling                               credits per ounce Pt/Pd produced (Non-GAAP)         $      615  $      595  Less: By-product credit per ounce Pt/Pd produced            (45)        (50) Less: Recycling income credit per ounce Pt/Pd                                 produced                                                   (24)        (47)                                                      ----------  ----------  Total cash cost net of by-product and recycling                               credits per ounce Pt/Pd produced (Non-GAAP)         $      546  $      498                                                                               Divided by ore tons milled                                  178         202                                                                               Total cash cost before by-product and recycling                               credits per ore ton milled (Non-GAAP)               $      310  $      274  Less: By-product credit per ore ton milled                  (23)        (23) Less: Recycling income credit per ore ton milled            (12)        (22)                                                      ----------  ----------  Total cash cost net of by-product and recycling                               credits per ore ton milled (Non-GAAP)               $      275  $       29                                                                               Reconciliation to costs of revenues:                                         Total cash cost net of by-product and recycling                               credits (Non-GAAP)                                  $   49,042  $   46,143  Asset retirement costs                                      169         155  Depletion, depreciation and amortization                 11,385      11,609  Depletion, depreciation and amortization (in                                  inventory)                                                 372        (600) Change in product inventories                            (4,050)     (2,114) By-product credit                                         4,016       4,665  Profit from PGM Recycling (before bad debt expense                            and gain/loss on asset disposals)                        2,170       4,397                                                       ----------  ----------  Total cost of revenues                               $   63,104  $   64,255                                                       ==========  ==========  Memo: Royalties, Taxes and Other included in Total                            cost of revenues                                    $    7,933  $    8,248                                                                                                                                                                                                                                         Stillwater Mining Company                                                    Reconciliation of Non-GAAP Measures to Consolidated Costs of Revenues         (Continued)                                                                  (Unaudited)                                                                                                                                                                                                      Three Months Ended                                                               March 31,                                                             ----------------------- (In thousands, except per ounce and per ton data)       2014        2013                                                          ----------  ----------  East Boulder                                                                 Total cash cost before by-product and recycling                               credits (Non-GAAP)                                  $   28,823  $   24,817  Less: By-product credit                                  (2,665)     (2,844) Less: Recycling income credit                              (997)     (1,634)                                                      ----------  ----------  Total cash cost net of by-product and recycling                               credits (Non-GAAP)                                  $   25,161  $   20,339                                                                               Divided by platinum/palladium ounces produced                41          34                                                                               Total cash cost before by-product and recycling                               credits per ounce Pt/Pd produced (Non-GAAP)         $      703  $      719  Less: By-product credit per ounce Pt/Pd produced            (65)        (82) Less: Recycling income credit per ounce Pt/Pd                                 produced                                                   (24)        (47)                                                      ----------  ----------  Total cash cost net of by-product and recycling                               credits per ounce Pt/Pd produced (Non-GAAP)         $      614  $      590                                                                               Divided by ore tons milled                                  117         111                                                                               Total cash cost before by-product and recycling                               credits per ore ton milled (Non-GAAP)               $      247  $      225  Less: By-product credit per ore ton milled                  (23)        (26) Less: Recycling income credit per ore ton milled             (9)        (15)                                                      ----------  ----------  Total cash cost net of by-product and recycling                               credits per ore ton milled (Non-GAAP)               $      215  $      184                                                                               Reconciliation to costs of revenues:                                         Total cash cost net of by-product and recycling                               credits (Non-GAAP)                                  $   25,161  $   20,339  Asset retirement costs                                       12          12  Depletion, depreciation and amortization                  3,525       3,416  Depletion, depreciation and amortization (in                                  inventory)                                                 181        (153) Change in product inventories                            (2,743)     (1,569) By-product credit                                         2,665       2,844  Profit from PGM Recycling (before bad debt expense                            and gain/loss on asset disposals)                          997       1,634                                                       ----------  ----------  Total cost of revenues                               $   29,798  $   26,523                                                       ==========  ==========  Memo: Royalties, Taxes and Other included in Total                            cost of revenues                                    $    4,080  $    3,444                                                                               PGM Recycling and Other: (1)                                                 Cost of open market purchases                        $       79  $        -  Cost of PGM Recycling                                    90,706     116,862  PGM Recycling - depreciation                                241         258                                                       ----------  ----------  Total cost of revenues                               $   91,026  $  117,120                                                       ==========  ==========                                                                               (1) PGM Recycling and Other include PGM recycling and metal purchased on the     open market for resale.                                                     Stillwater Mining Company  All-In Sustaining Cost a Non-GAAP Measure  (Unaudited)   All-In Sustaining Costs (Non-GAAP): This non-GAAP measure is used as an indicator from period to period of the level of total cash required by the business to maintain and operate the existing mines, including corporate administrative costs and replacement capital. The measure is calculated beginning with total cash costs (another non-GAAP measure, described above), and adding to it the recycling income credit, corporate overhead costs (excluding any depreciation and amortization costs and other non-recurring non-cash costs included in corporate overhead costs), marketing costs, and that portion of total capital expenditures associated with sustaining the current level of mining operations.  When divided by the total recoverable PGM ounces in the respective period, All-In Sustaining Costs per Mined Ounce (non-GAAP) provides an indication of the level of total cash required to maintain and operate the mines per PGM ounce produced in the period. Recoverable PGM ounces from production are an indication of the amount of PGM product extracted through mining in any period. Because the objective of PGM mining activity is to extract PGM material, the all-in cash cost per ounce to produce PGM material, administer the business and sustain the operating capacity of the mines is a useful measure for comparing overall extraction efficiency between periods. This measure is affected by the total level of spending in the period and by the grade and volume of ore produced.                                                                                                                                           Three Months Ended                                                               March 31,                                                             ----------------------- (In thousands, except $/oz.)                            2014        2013                                                          ----------  ----------  All-In Sustaining Costs                                                      Total cash cost net of by-product and recycling                               credits (Non-GAAP)                                  $   74,203  $   66,482  Add: Recycling income credit                              3,167       6,031                                                       ----------  ----------                                                       $   77,370  $   72,513                                                                               Consolidated Corporate General & Administrative                               costs                                               $    9,604  $   15,187  Less: Depreciation and amortization included in                               Consolidated Corporate General & Administrative                              costs                                                     (112)        (81) Less: General & Administrative Costs in Foreign                               Subsidiaries                                            (1,856)     (1,512) Add: Marketing costs                                        151       1,727                                                       ----------  ----------                                                       $    7,787  $   15,321                                                                               Total Capitalized Costs accrued                      $   24,674  $   28,447  Less: Capital associated with expansion projects         (6,799)     (8,891)                                                      ----------  ----------  Total Capital incurred to sustain existing                                    operations                                          $   17,875  $   19,556                                                                                                                                    ----------  ----------  All-In Sustaining Cost (Non-GAAP)                    $  103,032  $  107,390                                                       ==========  ==========                                                                               Mined ounces produced                                     130.7       127.1                                                                                                                                    ----------  ----------  All-In Sustaining Cost per Mined Ounce ($/oz.) (Non-                          GAAP)                                               $      788  $      845                                                       ----------  ----------      INVESTOR CONTACT:  Mike Beckstead (406) 373-8971