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Kinross meets guidance, tips 2020 dip

Producer Kinross Gold has met production and cost guidance for the eighth consecutive year and is moving to shore up future production, although it’s forecast slightly lower output for 2020.
Kinross meets guidance, tips 2020 dip Kinross meets guidance, tips 2020 dip Kinross meets guidance, tips 2020 dip Kinross meets guidance, tips 2020 dip Kinross meets guidance, tips 2020 dip

Kinross Gold produced 2.5Moz gold-equivalent in 2019

Staff reporter

The company produced just over 2.5 million attributable gold-equivalent ounces in 2019, an increase on 2018's 2.45Moz Au-eq.

However it expects to produce 2.4Moz Au-eq (+/-5%) in 2020, mainly due to Maricunga transitioning to care and maintenance and expected lower production at Paracatu, which had a record 2019, partially offset by a predicted rise at Fort Knox and Tasiast, where an expansion is underway.
 
All-in sustaining costs for 2019 were within guidance at US$983/oz Au-eq and Kinross has tipped a decrease to $970/oz in 2020.

President and CEO J. Paul Rollinson expected production at or above 2019 levels in 2021 and for AISC to further decrease.

"We currently expect a further reduction in capital expenditures and all-in sustaining costs for 2022, with production expected to remain at the 2.5Moz level," he said.

La Coipa to restart

Kinross has given the go-ahead to the La Coipa restart in Chile, using existing infrastructure to mine the Phase 7 deposit.

Initial capex is estimated at $225 million and La Coipa is expected to produce 690,000 Au-eq from 2022 to 2024 at a cost of sales of $575/oz, with pre-stripping scheduled to begin late this year.

Kinross added 7.7Moz of gold to its measured and indicated resources in 2019, a 28% increase year-on-year and mainly due to its acquisition, completed on January 16, of the Chulbatkan project in Russia which added 3.9Moz.
 
"In terms of 2019 financial performance, Kinross increased operating cash flow by 55% to $1.2 billion, more than tripled adjusted net earnings to $423 million, grew our margins by 28%, and improved liquidity to $2 billion while continuing to invest in our development projects," Rollinson said.

The adjusted net earnings equated to 34c per share, up from $128.1 million or 10c/share for 2018, due to higher margins.

The company ended 2019 with cash and equivalents of $575.1 million, compared with $349 million a year earlier, primarily due to net operating cash flows.

Kinross' shares are trading near the upper end of a 52-week range of C$4.04-$7.24, closing up 0.3% yesterday to $6.64 to capitalise it at $8.3 million (US$6.3 million).