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Goldcorp (GG) Earnings and Revenues Miss Estimates in Q3
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Goldcorp Inc. reported net earnings of $59 million or 7 cents per share for third-quarter 2016 as against a net loss of $192 million or 23 cents per share a year ago. Earnings in third-quarter 2016 benefited from lower all-in sustaining costs (“AISC”).
Barring one-time items, net earnings for the reported quarter were 11 cents per share, which missed the Zacks Consensus Estimate by a penny.
Goldcorp posted revenues of $915 million in the reported quarter, down roughly 16.7% year over year. Revenues also lagged the Zacks Consensus Estimate of $1,067 million.
Average realized gold price for the quarter rose 19.7% to $1,333 per ounce from $1,114 per ounce in the prior-year quarter.
Gold sales plunged around 27.2% year over year to 686,000 ounces in the reported quarter and production tumbled 22.5% to 715,000 ounces. AISC was $812 per gold ounce (down 5.4% year over year) due to lower production costs and currency tailwinds, partly offset by lower sales volumes at Penasquito, Cerro Negro, Los Filos and Eleonore, while cash cost totaled $554 per ounce on a by-product basis (down 7.2% year over year) and $657 per ounce (down 1.9%) on a co-product basis.
Silver production declined roughly 31.9% year over year to 7.7 million ounces from 11.3 million ounces in the prior-year quarter.
Shares of the company fell around 3.7% to close at $14.76 on Oct 27.
Mining Highlights
At the Penasquito mine, gold production was 121,000 ounces, marking a year-over-year decrease of around 48.7%. Production declined due to lower ore grade, lower throughput and lower recoveries due to processing lower grade stockpile ore. AISC was $777 per ounce compared with $467 per ounce in the year-ago quarter.
Cerro Negro in Argentina produced 96,000 ounces of gold in the third quarter, at an AISC of $651 per ounce. Production declined from the year-ago quarter as a result of lower mill tonnage processed due to the exhaustion of surface stockpiles.
At Pueblo Viejo, where Goldcorp holds 40% interest and Barrick Gold holds 60% interest, gold production jumped nearly 9.6% year over year to 126,000 ounces (40% basis), at an AISC of $454 per ounce. The upside was backed by higher grades and recoveries from processing higher grade ores.
Financial Position
As of Sep 30, 2016, cash and cash equivalents were $340 million, up from $257 million as of Sep 30, 2015. Long-term debt was $2,479 million as of Sep 30, 2016, compared with $2,522 million as of Sep 30, 2015. The company’s adjusted operating cash flow fell to $341 million as of Sep 30, 2016, from $374 million as of Sep 30, 2015. Of this, $226 million was used to repay debt, $56 million was invested in the growth pipeline and $14 million was paid in dividends.
Outlook
For 2016, Goldcorp reiterated its gold production guidance range of 2.8−3.1 million ounces at AISC of $850−$925 per ounce.
Production in the fourth quarter is expected to rise from the third quarter as Penasquito continues mining higher grades.
Goldcorp currently carries a Zacks Rank #3 (Hold).
Some better-ranked companies in the gold mining space include Eldorado Gold Corporation (EGO - Free Report) , Newmont Mining Corporation (NEM - Free Report) and Pershing Gold Corporation .
Eldorado Gold, carrying a Zacks Rank #2 (Buy), has an expected long-term growth of 5.00%
Pershing Gold, also a Zacks Rank #2 stock, posted a positive earnings surprise of 20.00% in its last reported quarter.
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Goldcorp (GG) Earnings and Revenues Miss Estimates in Q3
Goldcorp Inc. reported net earnings of $59 million or 7 cents per share for third-quarter 2016 as against a net loss of $192 million or 23 cents per share a year ago. Earnings in third-quarter 2016 benefited from lower all-in sustaining costs (“AISC”).
Barring one-time items, net earnings for the reported quarter were 11 cents per share, which missed the Zacks Consensus Estimate by a penny.
Goldcorp posted revenues of $915 million in the reported quarter, down roughly 16.7% year over year. Revenues also lagged the Zacks Consensus Estimate of $1,067 million.
Average realized gold price for the quarter rose 19.7% to $1,333 per ounce from $1,114 per ounce in the prior-year quarter.
Gold sales plunged around 27.2% year over year to 686,000 ounces in the reported quarter and production tumbled 22.5% to 715,000 ounces. AISC was $812 per gold ounce (down 5.4% year over year) due to lower production costs and currency tailwinds, partly offset by lower sales volumes at Penasquito, Cerro Negro, Los Filos and Eleonore, while cash cost totaled $554 per ounce on a by-product basis (down 7.2% year over year) and $657 per ounce (down 1.9%) on a co-product basis.
Silver production declined roughly 31.9% year over year to 7.7 million ounces from 11.3 million ounces in the prior-year quarter.
Shares of the company fell around 3.7% to close at $14.76 on Oct 27.
Mining Highlights
At the Penasquito mine, gold production was 121,000 ounces, marking a year-over-year decrease of around 48.7%. Production declined due to lower ore grade, lower throughput and lower recoveries due to processing lower grade stockpile ore. AISC was $777 per ounce compared with $467 per ounce in the year-ago quarter.
Cerro Negro in Argentina produced 96,000 ounces of gold in the third quarter, at an AISC of $651 per ounce. Production declined from the year-ago quarter as a result of lower mill tonnage processed due to the exhaustion of surface stockpiles.
At Pueblo Viejo, where Goldcorp holds 40% interest and Barrick Gold holds 60% interest, gold production jumped nearly 9.6% year over year to 126,000 ounces (40% basis), at an AISC of $454 per ounce. The upside was backed by higher grades and recoveries from processing higher grade ores.
Financial Position
As of Sep 30, 2016, cash and cash equivalents were $340 million, up from $257 million as of Sep 30, 2015. Long-term debt was $2,479 million as of Sep 30, 2016, compared with $2,522 million as of Sep 30, 2015. The company’s adjusted operating cash flow fell to $341 million as of Sep 30, 2016, from $374 million as of Sep 30, 2015. Of this, $226 million was used to repay debt, $56 million was invested in the growth pipeline and $14 million was paid in dividends.
Outlook
For 2016, Goldcorp reiterated its gold production guidance range of 2.8−3.1 million ounces at AISC of $850−$925 per ounce.
Production in the fourth quarter is expected to rise from the third quarter as Penasquito continues mining higher grades.
GOLDCORP INC Price, Consensus and EPS Surprise
GOLDCORP INC Price, Consensus and EPS Surprise | GOLDCORP INC Quote
Zacks Rank
Goldcorp currently carries a Zacks Rank #3 (Hold).
Some better-ranked companies in the gold mining space include Eldorado Gold Corporation (EGO - Free Report) , Newmont Mining Corporation (NEM - Free Report) and Pershing Gold Corporation .
Eldorado Gold, carrying a Zacks Rank #2 (Buy), has an expected long-term growth of 5.00%
Newmont Mining, with an average positive earnings surprise of 11.90% in the trailing four quarters, carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Pershing Gold, also a Zacks Rank #2 stock, posted a positive earnings surprise of 20.00% in its last reported quarter.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>