XML 33 R19.htm IDEA: XBRL DOCUMENT
v3.19.1

Derivative Financial Instruments | 3 Months Ended
--- | ---
Mar. 31, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
DERIVATIVE FINANCIAL INSTRUMENTS | DERIVATIVE FINANCIAL INSTRUMENTS Provisional Metal Sales The Company enters into sales contracts with third-party smelters, refiners and off-take customers which, in some cases, provide for a provisional payment based upon preliminary assays and quoted metal prices. The provisionally priced sales contracts contain an embedded derivative that is required to be separated from the host contract for accounting purposes. The host contract is the receivable recorded at the forward price at the time of sale. The embedded derivatives do not qualify for hedge accounting and are marked to market through earnings each period until final settlement. Interest Rate Swap The Company is a party to two interest rate swap contracts in which it will receive variable-rate interest and pay fixed-rate interest. The Company uses these instruments to manage its exposure to changes in interest rates related to its RCF (see Note 8-- Debt). The interest rate swap derivative instruments are not designated as hedges from an accounting standpoint and hedge accounting is not applied. The notional amount is used to measure interest to be paid or received. The first interest rate swap derivative instrument, with a notional amount of $50.0 million, became effective June 2018 and covers a contractual term of twelve months and net settles monthly. The second interest rate swap derivative instrument, with a notional amount of $75.0 million, will become effective June 2019 and covers a contractual term of six months and net settles monthly. At March 31, 2019, the Company had the following derivative instruments that settle as follows:
In thousands except average prices and notional ounces | 2019 |  | Thereafter
Provisional silver sales contracts | $ | 5,712 |  |  | $ | — |
Average silver price per ounce | $ | 15.11 |  |  | $ | — |
Notional ounces | 378,139 |  |  | — |
Provisional gold sales contracts | $ | 10,657 |  |  | $ | — |
Average gold price per ounce | $ | 1,303 |  |  | $ | — |
Notional ounces | 8,178 |  |  | — |
Provisional zinc sales contracts | $ | 11,581 |  |  | $ | — |
Average zinc price per pound | $ | 1.27 |  |  | $ | — |
Notional pounds | 9,099,116 |  |  | — |
Provisional lead sales contracts | $ | 4,234 |  |  | $ | — |
Average lead price per pound | $ | 0.91 |  |  | $ | — |
Notional pounds | 4,648,252 |  |  | — |
Fixed interest rate swap payable | $ | 323 |  |  | $ | — |
Fixed Interest rate | 2.46 | % |  | — |
Notional dollars | $ | 50,000 |  |  | $ | — |
Variable interest rate swap receivable | $ | 326 |  |  | $ | — |
Average variable interest rate | 2.49 | % |  | $ | — |
Notional dollars | $ | 50,000 |  |  | $ | — |
Fixed interest rate swap payable | $ | 960 |  |  | $ | — |
Fixed Interest rate | 2.50 | % |  | — |
Notional dollars | $ | 75,000 |  |  | $ | — |
Variable interest rate swap receivable | $ | 911 |  |  | $ | — |
Average variable interest rate | 2.49 | % |  | $ | — |
Notional dollars | $ | 75,000 |  |  | $ | — |
The following summarizes the classification of the fair value of the derivative instruments:
| March 31, 2019
In thousands | Prepaid expenses and other |  | Accrued liabilities and other
Provisional metal sales contracts | $ | 550 |  |  | $ | 161 |
Interest rate swaps | 3 |  |  | (49 | )
| $ | 553 |  |  | $ | 112 |
| December 31, 2018
In thousands | Prepaid expenses and other |  | Accrued liabilities and other
Provisional metal sales contracts | $ | 784 |  |  | $ | 644 |
Zinc options | 113 |  |  | — |
Interest rate swaps | 17 |  |  | — |
| $ | 914 |  |  | $ | 644 |
The following represent mark-to-market gains (losses) on derivative instruments for the three months ended March 31, 2019 and 2018, respectively (in thousands):
|  | Three Months Ended March 31,
Financial statement line | Derivative | 2019 |  | 2018
Revenue | Provisional metal sales contracts | $ | 250 |  |  | $ | 253 |
Fair value adjustments, net | Zinc options | — |  |  | 145 |
Fair value adjustments, net | Interest rate swaps | (46 | ) |  | — |
|  | $ | 204 |  |  | $ | 398 |
Credit Risk The credit risk exposure related to any derivative instrument is limited to the unrealized gains, if any, on outstanding contracts based on current market prices. To reduce counter-party credit exposure, the Company enters into contracts with institutions management deems credit-worthy and limits credit exposure to each institution. The Company does not anticipate non-performance by any of its counterparties.

X
- References No definition available. + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration