ENP Newswire -
Release date- 02052014 -
Reported net earnings were
First Quarter 2014 Highlights
Adjusted revenues totaled
Gold sales1 totaled 684,000 ounces on gold production1 of 679,900 ounces.
All-in sustaining costs decreased 26% versus the prior year to
Adjusted operating cash flow totaled
Adjusted net earnings were
Dividends paid totaled
Sale of Primero interest for
Sale of Marigold mine completed on
'2014 is a year of significant forecast growth for Goldcorp, and solid first quarter production and lower all-in sustaining costs represent a strong start toward the achievement of our guidance,' said
Gold sales in the first quarter were 684,000 ounces on production of 679,900 ounces. This compares to sales of 595,100 ounces on production of 614,600 ounces in the first quarter of 2013. Silver production totaled 9.6 million ounces compared to silver production of 5.6 million ounces in the prior year's first quarter. All-in sustaining costs were
Adjusted revenues were
Adjusted net earnings in the first quarter of 2014 primarily exclude the losses from the foreign exchange translation of deferred income tax assets and liabilities, and losses from the foreign exchange on capital projects, and the gain from the disposition of mining interests but include the impact of non-cash stock-based compensation expenses which amounted to approximately
At Penasquito, production totaled 129,800 gold ounces at a record low all-in sustaining cost of$371 per ounce. Grades continued to increase over the prior quarter as mining continued in a higher-grade portion of the deposit. Lower all-in sustaining costs were driven by continued success of the Operating for Excellence program and higher by-product credits.
The Northern Well Field project is expected to begin construction by mid-year 2014 with completion now expected around mid-year 2015, approximately six months later than planned, due to land access and permitting challenges. Contingency plans have been developed for fresh water production to ensure plant production continues as planned and guidance for 2014 remains unchanged at between 530,000 and 560,000 ounces.
The exploration drilling program at Penasquito continues to define the intersection of the copper-gold sulphide rich skarn deposit located below and adjacent to the diatreme ore body. Current exploration activities continue to focus on in-fill and extension of the higher grade portion of the skarn deposit.
Gold production at Los Filos was 80,000 ounces in the first quarter at an all-in sustaining cost of$805 per ounce. The construction of the next phase of the heap leach pad, including additional contingency solution storage capacity, commenced during the fourth quarter of 2013 and is expected to be completed late in the second quarter of 2014. Operations at the Los Filos mine were suspended on
At Porcupine in
Advancing Towards First Gold Production
The Cerro Negro project in
Mine development continued on the underground deposits of Eureka and Mariana Central. Production has commenced at Eureka, while production at Mariana Central is expected to start in the second half of 2014. At the end of the first quarter the ore stockpile contained an estimated 410,100 tonnes at an average grade of 9.84 grams of gold per tonne and 183.4 grams of silver per tonne.
The exploration ramp excavation reached 4,686 metres at the end of the first quarter, corresponding to a depth of 725 metres below surface and was connected with the main 650m level. The production shaft reached a depth of 735 metres. The ore stockpile on surface now contains 25,104 tonnes at an average grade of 3.9 grams of gold per tonne.
A total of 19,575 metres of underground diamond drilling was completed in the first quarter of 2014. Exploration drilling targeted the center of the
A ramp of 1,175 metres is being developed to continue the decline down to the 4,000 foot level.
At the Camino Rojo project near Penasquito in
2014 Guidance Outlook
The Company today reconfirmed guidance for 2014 of between 2.95 and 3.10 million ounces (following the divestiture of Marigold) at all-in sustaining costs of between
Goldcorp is one of the world's fastest growing senior gold producers. Its low-cost gold production is located in safe jurisdictions in the
This release should be read in conjunction with Goldcorp's first quarter 2014 interim consolidated financial statements and MD&A report on the Company's website, in the 'Investor Resources - Reports & Filings' section under 'Quarterly Reports'.
A conference call will be held on
The Company has included non-GAAP performance measures on an attributable (or Goldcorp's share) basis throughout this document. Attributable performance measures include the Company's mining operations, including its discontinued operation, and projects, and the Company's share of Alumbrera and
The Company believes that, in addition to conventional measures prepared in accordance with GAAP, the Company and certain investors use this information to evaluate the Company's performance and ability to generate cash flow; however, these performance measures do not have any standardized meaning. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP.
Adjusted net earnings and adjusted net earnings per share are non-GAAP performance measures. The Company believes that, in addition to conventional measures prepared in accordance with GAAP, the Company and certain investors use this information to evaluate the Company's performance. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Refer to page 42 of the Q1 2014 Management Discussion & Analysis ('MD&A') for a reconciliation of adjusted net earnings to reported net earnings attributable to shareholders of Goldcorp.
Adjusted operating cash flows and adjusted operating cash flows per share are non-GAAP performance measures which comprises Goldcorp's share of operating cash flows before working capital changes and which the Company believes provides additional information about the Company's ability to generate cash flows from its mining operations. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Refer to page 43 of the Q1 2014 MD&A for a reconciliation of adjusted operating cash flows to reported net cash provided by operating activities.
For 2013, the Company adopted an 'all-in sustaining cost' non-GAAP performance measure that the Company believes more fully defines the total costs associated with producing gold. All-in sustaining costs include by-product cash costs, sustaining capital expenditures, corporate administrative expense, exploration and evaluation costs and reclamation cost accretion and amortization.
As the measure seeks to reflect the full cost of gold production from current operations, new project capital is not included in the calculation. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The Company reports this measure on a sales basis. Refer to page 40 of the Q1 2014 MD&A for a reconciliation of all-in sustaining costs.
The Company has included non-GAAP performance measures - total cash costs, by-product and co-product, per gold ounce, throughout this document. The Company reports total cash costs on a sales basis. In the gold mining industry, this is a common performance measure but does not have any standardized meaning. The Company follows the recommendations of the Gold Institute Production Cost Standard. The production cost standard developed by the
In addition to conventional measures prepared in accordance with GAAP, the Company assesses this measure in a manner that isolates the impacts of gold production volumes, the by-product credits, and operating costs fluctuations such that the non-controllable and controllable variability is independently addressed. The Company uses total cash costs, by product and co-product, per gold ounce, to monitor its operating performance internally, including operating cash costs, as well as in its assessment of potential development projects and acquisition targets.
The Company believes these measures provide investors and analysts with useful information about the Company's underlying cash costs of operations and the impact of by-product credits on the Company's cost structure and is a relevant metric used to understand the Company's operating profitability and ability to generate cash flow. When deriving the production costs associated with an ounce of gold, the Company includes by-product credits as the Company considers that the cost to produce the gold is reduced as a result of the by-product sales incidental to the gold production process, thereby allowing the Company's management and other stakeholders to assess the net costs of gold production.
The Company believes that, in addition to conventional measures prepared in accordance with GAAP, the Company and certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Total cash costs on a by-product basis are calculated by deducting Goldcorp's share of by-product silver, copper, lead and zinc sales revenues from Goldcorp's share of production costs.
Total cash costs on a co-product basis are calculated by allocating Goldcorp's share of production costs to each co-product based on the ratio of actual sales volumes multiplied by budget metal prices as compared to realized sales prices.
Cautionary Note to United States Investors Concerning Estimates of Measured, Indicated and Inferred Resources:
It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies.
Cautionary Note Regarding Forward Looking Statements
This press release contains 'forward-looking statements', within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities legislation, concerning the business, operations and financial performance and condition of
Forward-looking statements include, but are not limited to, statements with respect to the future price of gold, silver, copper, lead and zinc, the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, costs and timing of the development of new deposits, success of exploration activities, permitting time lines, hedging practices, currency exchange rate fluctuations, requirements for additional capital, government regulation of mining operations, environmental risks, unanticipated reclamation expenses, timing and possible outcome of pending litigation, title disputes or claims and limitations on insurance coverage.
Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as 'plans', 'expects', 'is expected', 'budget', 'scheduled', 'estimates', 'forecasts', 'intends', 'anticipates', 'believes' or variations of such words and phrases or statements that certain actions, events or results 'may', 'could', 'would', 'might' or 'will be taken', 'occur' or 'be achieved' or the negative connotation thereof.
Forward-looking statements are made based upon certain assumptions and other important factors that, if untrue, could cause the actual results, performances or achievements of Goldcorp to be materially different from future results, performances or achievements expressed or implied by such statements.
Such statements and information are based on numerous assumptions regarding present and future business strategies and the environment in which Gold corp. will operate in the future, including the price of gold, anticipated costs and ability to achieve goals.
Certain important factors that could cause actual results, performances or achievements to differ materially from those in the forward-looking statements include, among others, gold price volatility, discrepancies between actual and estimated production, mineral reserves and resources and metallurgical recoveries, mining operational and development risks, litigation risks, regulatory restrictions (including environmental regulatory restrictions and liability), activities by governmental authorities (including changes in taxation), currency fluctuations, the speculative nature of gold exploration, the global economic climate, dilution, share price volatility, competition, loss of key employees, additional funding requirements and defective title to mineral claims or property.
Although Goldcorp has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended.
Forward-looking statements are subject to known and unknown risks, uncertainties and other important factors that may cause the actual results, level of activity, performance or achievements of Goldcorp to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the integration of acquisitions; risks related to international operations, including economic and political instability in foreign jurisdictions in which Goldcorp operates; risks related to current global financial conditions; risks related to joint venture operations; actual results of current exploration activities; environmental risks; future prices of gold, silver, copper, lead and zinc; possible variations in ore reserves, grade or recovery rates; mine development and operating risks; accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; risks related to indebtedness and the service of such indebtedness, as well as those factors discussed in the section entitled 'Description of the Business - Risk Factors' in Goldcorp's annual information form for the year ended
Although Goldcorp has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
Forward-looking statements are made as of the date hereof and accordingly are subject to change after such date. Except as otherwise indicated by Goldcorp, these statements do not reflect the potential impact of any non-recurring or other special items or of any dispositions, monetizations, mergers, acquisitions, other business combinations or other transactions that may be announced or that may occur after the date hereof.
Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans and allowing investors and others to get a better understanding of our operating environment. Goldcorp does not undertake to update any forward-looking statements that are included in this document, except in accordance with applicable securities laws.
Tel: (604) 696-3074
Fax: (604) 696-3001
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