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Goldcorp's (GG) Q4 Earnings and Revenues Miss Estimates

Goldcorp Inc.GG reported net earnings of $242 million or 28 cents per share for fourth-quarter 2017 compared with $101 million or 12 cents recorded a year ago.

Barring one-time items, adjusted earnings for the quarter came in at 10 cents per share, which missed the Zacks Consensus Estimate of 11 cents.

Goldcorp recorded revenues of $853 million in the fourth quarter, down roughly 5% year over year. The figure also missed the Zacks Consensus Estimate of $870 million.

Gold sales went down around 17.6% year over year to 633,000 ounces in the fourth quarter and production fell 15.1% to 646,000 ounces.

All-in sustaining costs (AISC) were $870 per gold ounce (up roughly 16.5% year over year).

Full-Year 2017 Results

For 2017, Goldcorp reported net earnings of $658 million or 76 cents per share, up from $162 million or 19 cents per share in 2016.

Revenues went down roughly 2.5% year over year to $3,423 million.

Goldcorp Inc. Price, Consensus and EPS Surprise

Goldcorp Inc. Price, Consensus and EPS Surprise | Goldcorp Inc. Quote

Mining Highlights

At the Penasquito mine, gold production was 83,000 ounces, marking a decrease of 54.6% year over year from 183,000 ounces. AISC was $571 per ounce, up 17.2% from $487 in the year-ago quarter.

At the Cerro Negro in Argentina, gold production went up a whopping 97% to 130,000 ounces. AISC was $672 per ounce compared with $1,024 recorded in the year-ago quarter.

At the Pueblo Viejo mine, gold production was 122,000 ounces, down 3.9% year over year. AISC was $496 per ounce compared with $311 in the year-ago quarter.

Financial Position

Goldcorp's cash and cash equivalents rose 18.5% year over year to $186 million. The company had adjusted net debt of $2,108 million at the end of 2017 compared with $2,216 million in 2016.

The company recorded operating cash flow of $1.2 billion for 2017, compared with $800 million in 2016.

Outlook

Goldcorp expects gold production of 2.5 million ounces (+/- 5%) for 2018 and AISC has been projected to further decline to roughly $800 per ounce (+/- 5%). Goldcorp stated that it continues to realize savings from its program and is aiming to achieve roughly $250 million of annual sustainable efficiencies.

Goldcorp also expects sustaining capital expenditure to be $550 million for 2018.

Price Performance

Goldcorp's shares have moved up 2.8% in the last three months, outperforming the 1.5% dip recorded by its industry .

Zacks Rank & Stocks to Consider

Goldcorp currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are Steel Dynamics, Inc. STLD , The Mosaic Company MOS and United States Steel Corporation X , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here .

Steel Dynamics has an expected long-term earnings growth rate of 12%. Its shares have soared 36.4% over the last six months.

Mosaic has an expected long-term earnings growth rate of 9.5%. Its shares have moved up 28.7% over the past six months.

U.S. Steel has an expected long-term earnings growth rate of 8%. Its shares have rallied 64.2% over the last six months.

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


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

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