Thursday, Goldcorp Inc. (G.TO, GG) reported a sharp decline in profit for the fourth quarter due to the absence of a hefty gain on non-hedge derivatives that boosted year ago results. Adjusted earnings ,however, increased from the year ago period.
The company reported fourth quarter net earnings of US$66.7 million or US$0.09 per share, compared with net earnings of US$958.1 million or US$1.31 per share in the fourth quarter of 2008.
Adjusted net earnings for the fourth quarter totaled US$182.7 million or US$0.25 per share, compared with US$84.4 million or US$0.12 per share in the fourth quarter of 2008.
On average, 17 analysts polled by Thomson Reuters expected the company to earn $0.25 per share. Analysts' estimates typically exclude special items.
Adjusted net earnings primarily exclude the effect of a non-cash foreign exchange loss on revaluation of future income tax liabilities and gain and losses on securities. Adjusted net earnings for the same period in 2008 primarily exclude the effect of a non-cash foreign exchange gain on revaluation of future income tax liabilities and an unrealized loss on securities.
Revenues in the quarter increased to US$778.3 million from $609.0 million in the same period in 2008, due primarily to higher realized gold, silver and copper prices.
Five analysts estimated revenues of US$732.43 million.
For the quarter, the company reported gold production of 601,300 ounces at a total cash cost of US$289 per ounce. Driven by higher by-product credits for silver and copper, total cash costs net of by-product credits were US$289 per gold ounce, compared with US$323 per gold ounce in the year-ago quarter while total cash costs on a co-product basis increased to US$422 per gold ounce in the fourth quarter from US$358 per gold ounce in the same period in 2008.
Red Lake produced 156,300 ounces of gold during the fourth quarter. The mine remains on track to increase its annual gold production to 675,000 ounces in 2010 compared to 622,000 ounces in 2009, driven by increased mining rates. Also in Ontario, gold production at Musselwhite mine increased to 56,300 ounces for the fourth quarter, driven by improved stope flexibility. Gold production at Porcupine was 71,700 ounces in the fourth quarter.
Fourth quarter gold production of 60,100 ounces drove the best annual performance to date at Los Filos, Mexico. Full-year production of 239,300 ounces in 2009 represented the largest gold production from a single mine in Mexico.
At Marlin mine in Guatemala, productivity increases in underground mining rates and metals recovery enhancements resulted in record production during 2009. Gold production in the fourth quarter was 78,600 ounces while silver production amounted to 1.33 million ounces.
For the sequential third quarter, Goldcorp reported a 62% fall in net income from last year, hurt by a foreign exchange loss compared to a hefty foreign exchange gain in the year-ago period. Excluding items, adjusted earnings per share for the quarter more than doubled from the prior year.
Net earnings in 2009 were US$240.2 million or US$0.33 per share, compared to net earnings of US$1.5 billion or US$2.06 per share in 2008. Adjusted net earnings for the year totaled US$588.2 million or US$0.80 per share, compared with US$397.0 million or US$0.56 per share in the previous year. Revenues increased to US$2.7 billion from US$2.4 billion in 2008.
Analysts estimated earnings of US$0.78 per share on revenues of US$2.66 billion.
On February 18, market rival Barrick Gold Corp. (ABX, ABX.TO) reported a profit for the fourth quarter compared to a loss in the year-ago period, bolstered by higher gold and copper prices. Barrick's adjusted earnings for the quarter rose from last year, helped by higher margins and higher copper sales.
Barrick posted net income of $215 million or $0.21 per share, compared with net loss of $468 million or $0.53 per share in the year-ago quarter. Total sales increased 13% to $2.36 billion from $2.09 billion in the year-ago quarter.
G.TO closed Thursday's last trade at C$40.87, up C$0.46 or 1.14%, on a volume of 1.94 million shares on the Toronto Stock Exchange.
GG closed Thursday's last trade at US$40.02, up US$0.57 or 1.44%, on a volume of 6.81 thousand shares on the New York Stock Exchange. In the after hours the stock traded down US$0.02 or 0.05%.
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