Canada-based gold mining company Yamana Gold Inc. (AUY,YRI.TO,YAU.L) on Tuesday reported a 60% fall in profit for the third quarter compared with last year, hurt by a loss on commodity derivatives compared to a hefty gain on commodity derivatives in the year-ago period. The company also reported a lower foreign exchange gain for the quarter. Excluding items, adjusted earnings per share more than doubled from a year ago, but missed analysts' consensus estimate by a penny. The company lowered its production outlook for fiscal year 2009.
Third-Quarter Results
The company's net earnings for the third quarter dropped to US$60.82 million or US$0.08 per share, from US$150.20 million or US$0.21 per share in the year-ago quarter.
The results for the latest quarter include stock-based compensation of US$1.8 million, foreign exchange gain including discontinued operations of US$6.7 million, unrealized loss on derivatives including discontinued operations of US$21.0 million, and future income tax expense on foreign currency translation of inter-company debt of US$18.9 million.
The year-ago quarter's results include foreign exchange gain of US$45.10 million, unrealized gain on derivatives of US$138.93 million, write-off of investments of US$22.72 million, write-off inventory of US$11.06 million and future income tax expense on foreign currency translation of inter corporate debt of US$33.39 million and mark-to-market on unsettled concentrate sales of US$38.38 million.
Adjusted earnings for the latest quarter rose to US$88.34 million or US$0.12 per share from US$31.50 million or US$0.05 per share in the year-ago quarter. On average, fifteen analysts polled by Thomson Reuters expected the company to report earnings of US$0.13 per share for the quarter.
The company noted that net earnings and adjusted earnings for the latest quarter were impacted by a deferred tax provision of US$0.03 per share. Revenues for the quarter surged 50% to US$333.18 million from US$221.62 million in the year-ago quarter. Analysts had a consensus revenue estimate for the quarter of US$357.66 million.
Mine operating earnings for the quarter were US$136.42 million, representing a 138% increase from US$57.24 million in the year-ago period. The increase in mine operating earnings for the quarter was mainly due to increased sales in all metals and higher prices for gold and silver, partially offset by lower copper prices.
Yamana's average realized price for gold rose to US$962 per ounce from US$861 in the year-ago period, while the average realized price for silver increased to US$14.97 per ounce from US$14.56 per ounce a year ago. The average realized price for copper declined to US$2.74 per pound from US$3.45 per pound in the prior-year period.
Operating earnings for the quarter were US$104.46 million, up from US$32.86 million in the same period last year.
The company's total production from all mines for the quarter were 314,707 gold equivalent ounces, or GEO, up 34% over the total production of 235,406 GEO in the year-ago quarter. The production for the latest quarter comprised of 261,789 ounces of gold and 2.9 million ounces of silver.
However, approximately 10,000 GEO were produced but not sold during the latest quarter due to timing and will be sold during the fourth quarter, the company said.
Gross margins per GEO sold for the quarter were US$792, representing a 55% increase from the year-ago period. Significant contributors to the increase in margin were the El Peñón, Jacobina and Minera Florida Mines as a result of the company's continued focus on cost control measures and margin maximization.
Year-To-Date Results
For the nine months, Yamana's net earnings declined to US$156.46 million or US$0.21 per share from US$255.41 million or US$0.36 per share in the prior-year period.
Adjusted earnings for the nine-month period were US$248.41 million, or US$0.34 per share, down from US$257.93 million or US$0.38 per share, in the same period last year.
Revenues for the period dropped to US$783.49 million from US$861.53 million a year ago.
Mine operating earnings for the period fell to US$283.2 million from US$415.8 million in the same period last year due to significantly lower average prices for copper and silver in the most recent period.
Outlook
For fiscal year 2009, Yamana now forecasts total production in the range of 1.05 million-1.1 million GEO, not including non-core mines under sale. Earlier, the company had forecast production of approximately 1.1 million GEO for the year.
Further, Yamana said it committed to the sustainable production of at least 1.1 million GEO annually and plans to increase this from 2010 onwards. The company continues to focus on exploration to achieve 1.7 million GEO of sustained production in the long-run.
Stock Quotes
AUY closed Tuesday's regular trading on the NYSE at US$11.68, up US$0.87 or 8.05% on a volume of 30.36 million shares. In the past 52 weeks, the stock has been trading in a range of US$3.49-US$12.76.
On the Toronto Stock Exchange, YRI.TO closed Tuesday's trading at C$12.54, up CS$0.89 or 7.64% on a volume of 10.42 million shares.
For comments and feedback contact: editorial@rttnews.com
June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.