Yamana Gold Inc. (AUY,YAU.L,YRI.TO) reported that its fourth-quarter net earnings were $169.2 million or $0.22 per share, up from $89.6 million or $0.12 per share in the fourth quarter of 2011. Higher net earnings for the fourth quarter of 2012 were mainly due to higher mine operating earnings, partly offset by higher operating expenses and higher income tax expenses.
Adjusted earnings were $197.4 million or $0.26 earnings per share in the fourth quarter of 2012, compared with $184.2 million or $0.25 per share in the same quarter of 2011. Higher adjusted earnings in the fourth quarter of 2012 were mainly due to higher mine operating earnings, partly offset by higher general and administrative expense, and exploration and evaluation expense in the fourth quarter of 2012. Analysts polled by Thomson Reuters expected the company to report earnings of $0.25 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter were $629.5 million, compared with $568.8 million in the same quarter of 2011. Three analysts had consensus revenue estimate of $665.25 million for the quarter.
Mine operating earnings were $322.1 million in the quarter, compared with $296.8 million in the fourth quarter of 2011. Higher revenues and mine operating earnings were mainly due to higher sales volume of gold from the production of the new Mercedes mine, which was under construction during the comparative period, higher volume of silver sales and higher metal prices, partly offset by lower volume of sales of copper at Chapada.
Revenues for the quarter were generated from the sale of 304,070 gold equivalent ounces or GEO, consisted of 258,978 ounces of gold and 2.3 million ounces of silver, and 37.1 million pounds of copper, excluding Alumbrera which is accounted for as an equity investment. This compared to sales, excluding Alumbrera, of 262,782 GEO ounces, consisting of 218,831 ounces of gold and 2.2 million ounces of silver, and 43.6 million pounds of copper in the fourth quarter of 2011.
Total production was 322,990 GEO for the fourth quarter, including the Company's attributable production from the Alumbrera mine of 10,769 GEO and production during commissioning at Ernesto Pau-a-Pique of 1,274 GEO, compared with production of 276,918 GEO for the quarter ended December 31, 2011. Commercial production for the quarter of 321,716 GEO was also a quarterly production record, representing a 20% quarter-to-quarter increase.
Production in 2013 is expected to be in the range of 1.44 million to 1.60 million GEO with a target level of 1.48 million GEO.
Production in 2014 is expected to be in the range of 1.60 to 1.77 million GEO with a long-term sustainable target of 1.75 million GEO, representing an increase by approximately 33% from 2012 levels.
Silver production is expected to be consistent at between 8 million to 9 million ounces in each of 2013 and 2014. Silver production is reported as gold equivalent ounces and included in the above forecasts at a ratio of 50:1.
Copper production is expected to be in the range of 120 million to 135 million pounds in 2013 and 130 million to 145 million pounds in 2014. These estimates reflect the production from Chapada and do not include the attributable production from the Company's 12.5% interest in Alumbrera.
By 2015, production is targeted to be at a sustainable level of approximately 1.75 million GEO. This includes production from the existing mines and development projects for which construction decisions have been made.
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