NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2014 AND 2013
(All amounts in US$’000’s unless otherwise stated)
100
FORTUNA SILVER MINES INC. | 2014 ANNUAL REPORT
17. Segmented Information
All of the Company’s operations are within the mining sector, conducted through operations in three countries. Due to
geographic and political diversity, the Company’s mining operations are decentralized whereby management are
responsible for achieving specified business results within a framework of global policies and standards. Country
corporate offices provide support infrastructure to the mine in addressing local and country issues including financial,
human resources, and exploration support.
Products are silver, gold, lead, zinc and copper produced from mines in Peru and Mexico, as operated by Bateas and
Cuzcatlan, respectively. Segments have been aggregated where operations in specific regions have similar products,
production processes, types of customers and economic environment.
The Company’s operating segments are based on the reports reviewed by the senior management group that are used
to make strategic decisions. The Chief Executive Officer considers the business from a geographic perspective considering
the performance of the Company’s business units. The segment information for the reportable segments for the years
ended December 31, 2014 and 2013 are as follows:
Reportable Segments
Corporate
Bateas
Cuzcatlan
Total
Year ended December 31, 2014
Sales to external customers
$
– $
66,054 $ 107,952
$ 174,006
Silver-gold concentrates
–
–
107,952
107,952
Silver-lead concentrates
–
47,978
–
47,978
Zinc concentrates
–
18,076
–
18,076
Cost of sales*
–
51,13
62,622
113,753
Depletion and depreciation**
465
7,521
15,531
23,517
Selling, general and administrative expenses*
16,789
3,903
4,533
25,225
Restructuring and severance costs
1,021
70
–
1,091
Other material non-cash items
–
50
16
66
Impairment of inventories
–
121
–
121
Interest income
93
100
88
281
Interest expense
404
403
345
1,152
(Loss) income before tax
(18,120)
10,475
40,524
32,879
Income taxes
315
4,852
12,110
17,277
(Loss) income for the year
(18,435)
5,623
28,414
15,602
Capital expenditures***
87
9,850
29,006
38,943
* cost of sales and selling, general and administrative expenses includes depletion and depreciation
** included in cost of sales or selling, general and administrative expenses
*** segmented capital expenditures are presented on a cash basis
