Centerra Gold Posts Q1 Results, Announces Quarterly Dividend


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Centerra Gold Inc. ( CG ) reported net earnings for the first quarter of 2013 of $51.4 million or $0.22 per common share reflecting higher gold sales due to the higher gold production at both operations during the period. For the same period in 2012, the company recorded net earnings of $9.6 million or $0.04 per common share. The 2012 results were impacted by a 10-day work stoppage at Kumtor in February 2012 and the acceleration of ice and waste material at Kumtor which required a change in the mine plan.

CG also announced a dividend of C$0.04 per common share (approximately US$9.4 million at the current exchange rate), payable on June 6, 2013 to shareholders of record on May 23, 2013. The ex-dividend date will be May 21, 2013.

2013 First Quarter Highlights:

Produced 115,220 ounces of gold in the quarter, including 89,618 ounces at Kumtor and 25,602 ounces at Boroo, compared to 72,555 ounces in the same period in 2012.

Increased revenues to $192.3 million compared to $133.8 million in the same quarter of 2012.

Cash provided by operations increased to $92.0 million compared to $32.0 million in the first quarter of 2012.

Operating cash cost per ounce produced of $471 compared to $685 in the same period in 2012

Reported all-in cash cost (pre-tax) for the quarter of $1,327 per ounce compared to $2,902 for the 2012 first quarter.

Achieved 3 million man-hours without a lost time injury (LTI) at the Boroo mine.

Experienced accelerated movement in the Davidov Valley Waste-rock Dump at Kumtor.


Ian Atkinson, President and CEO of Centerra Gold said: "Operationally we are on track to achieve our production guidance for the year. Boroo had an excellent quarter producing almost 26,000 ounces of gold. Kumtor produced almost 90,000 ounces of gold, and mine production is on track to achieve the annual gold production forecast with over 50% of the gold production occurring in the fourth quarter. Financially, we reported over $51 million or $0.22 per share in net earnings and the operations generated $92 million or $0.39 per share of cash flow for the first quarter.

"As expected at the Kumtor mine the waste-rock dump is experiencing movement as was disclosed in the KS-13 expansion plan. The movement has recently increased impacting the workshops and administration facilities ahead of the planned schedule. As a result, we have expedited the demolition of the buildings and relocation of other infrastructure sooner than had been planned to ensure continued safe operations. Planned gold production for 2013 has not been affected to date. Employees have been moved to temporary work locations until the planned new facilities are constructed.

"Also regarding Kumtor, we are continuing to have discussions with the Kyrgyz authorities to resolve the issues concerning Kumtor to the benefit of all Centerra shareholders.

"Recently we have seen tremendous volatility in the gold price. We are monitoring and assessing its impact on the operations and are reviewing spending plans for 2013. Exploration spending in 2013 at Kumtor has been reduced by $5 million and further reductions may be contemplated in other areas. The company has a strong balance sheet and continuing good margins even in a lower gold price environment. Our all-in costs including all capital and taxes are forecast to be in the range of $1,247 to $1,360 per ounce of gold produced for the year."

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities

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