Part of it is the unrealized loss on the swap on the Secured credit facility. Unless interest rates move I don't see it turning positive in the near future. He could also be including the FX loss for the quarter as well.
If you look at the press release the 7.9m loss becomes non-gaap 7.8m in income when you add back:
1. The pricing adjustment on the unsettled concentrate for 5.7m
2. The 6.7m FX loss
3. The 3.3m unrealized loss on the credit facility
Management may be referring to these as the non cash items, but if the concentrate adjustment is from the change in metal prices from shipment out of Vancouver to receipt at the smelter in Japan it doesn't sound like non-cash to me. Maybe someone else has more insight on that item. (Actually I think this was one of the questions from the first analyst that had Rod quoting Coopers and Lybrand.)
It's curious that they added back the pricing adjustment in this quarter's non-gaap earnings but not Q1 which only backed out the FX.
If you look Quarter over quarter the 2 big changes that I can see is FX 5.2 gain Q1 vs 6.7 loss Q2 and the pricing adjustment which was 6.1m gain Q1 vs 9.6m loss Q2.
Operationally mining costs seem higher from the additional roll back of the benches which is in the mining plan as mentioned here already. Does anyone know how much longer this higher strip ratio is planned? I seem to recall it was for 6 months approx.
Hopefully with the August fixes to the grating, software and electrical system the operational issues are largely in the past.