Kinross Gold Produces 653,993 Ounces of Gold in Q3 2017
TORONTO, ON--(Marketwired - November 08, 2017) - Kinross Gold Corporation (TSX: K) (NYSE: KGC) today announced its results for the third-quarter ended September 30, 2017.
(This news release contains forward-looking information about expected future events and financial and operating performance of the Company. We refer to the risks and assumptions set out in our Cautionary Statement on Forward-Looking Information located on page 18 of this release. All dollar amounts are expressed in U.S. dollars, unless otherwise noted.)
2017 third-quarter highlights:
- Production1: 653,993 gold equivalent ounces (Au eq. oz.), compared with 684,129 Au eq. oz. in Q3 2016.
- Revenue: $828.0 million, compared with $910.2 million in Q3 2016.
- Production cost of sales(2): $662 per Au eq. oz., compared with $719 in Q3 2016.
- All-in sustaining cost2: $937 per Au eq. oz. sold, compared with $1,001 in Q3 2016. All-in sustaining cost per gold ounce (Au oz.) sold on a by-product basis was $927 in Q3 2017, compared with $987 in Q3 2016.
- Operating cash flow: $197.7 million, compared with $266.2 million in Q3 2016.
- Adjusted operating cash flow2: $320.8 million, compared with $320.3 million for Q3 2016.
- Reported net earnings(3): Net earnings increased to $60.1 million, or $0.05 per share, compared with net earnings of $2.5 million, or $0.00 per share, in Q3 2016.
- Adjusted net earnings2,3: $84.1 million, or $0.07 per share, compared with adjusted net earnings of $128.7 million, or $0.10 per share, in Q3 2016.
- Organic development projects:
- In mid-September 2017, the Company announced that it was proceeding with the Tasiast Phase Two and Round Mountain Phase W projects. Phase Two is expected to transform Tasiast into a large, world-class mine with low costs while Phase W is expected to extend mining by five years at Round Mountain.
- The Tasiast Phase One expansion continues to advance on time and on budget and is expected to reach full commercial production towards the end of Q2 2018. Plant construction is now 77% complete.
- Construction for the Tasiast Phase Two expansion is on schedule to start early next year, with engineering now 25% complete.
- At the Round Mountain Phase W project, stripping and initial construction is on schedule to begin early next year, pending the permitting process. The Decision Record from the U.S. Bureau of Land Management was received in October 2017 and state permits are proceeding as planned.
- At the Bald Mountain Vantage Complex, overall engineering work is now 70% complete and initial construction work is expected to commence in Q1 2018.
- At the Moroshka project located near Kupol, development of the twin declines is progressing on schedule.
- Outlook: Kinross is tracking towards the high end of its 2017 guidance for production (2.5 - 2.7 million Au eq. oz.), and the low end for both production cost of sales ($660 - $720 per Au eq. oz.) and all-in sustaining cost ($925 - $1,025 per Au eq. oz.). The Company expects to be within its capital expenditures guidance of $900 million (+/- 5%).
- Balance sheet: As of September 30, 2017, Kinross had cash and cash equivalents of $992.1 million, and available credit of $1,512.2 million, for total liquidity of approximately $2.5 billion.The Company has no scheduled debt repayments until 2021.
1 Unless otherwise stated, production figures in this news release are based on Kinross' 90% share of Chirano production.
2 These figures are non-GAAP financial measures and are defined and reconciled on pages 13 to 17 of this news release.
3 Net earnings/loss figures in this release represent "net earnings (loss) attributable to common shareholders".
J. Paul Rollinson, President and CEO, made the following comments in relation to 2017 third-quarter results:
"Kinross delivered strong third quarter results, bolstered by outperformance at our two Nevada mines and at Tasiast. We are on target to meet our annual guidance range for the sixth consecutive year, and are tracking towards the high end of our production and the low end of both our cost of sales and all-in sustaining cost guidance. We also generated solid cash flow and maintained one of the best balance sheets among our peers.
"Development at our suite of organic projects continues to proceed well. Tasiast Phase One is on track for full commercial production towards the end of Q2 2018 and engineering at Phase Two is now 25% complete. We also expect to start construction at Tasiast Phase Two, Round Mountain Phase W and the Vantage Complex at Bald Mountain early next year, as initial development work at all three projects is already in progress.
"We are continuing to deliver and have strong operational momentum as we head into year end."