London, Nov. 4, 2009 (PR Newswire UK Disclose) --
Yamana Gold reports third quarter 2009 results
- Record quarterly production with double digit revenue, cash flow and
margin growth -
TORONTO, Nov. 3 /CNW/ - YAMANA GOLD INC. (TSX:YRI; NYSE:AUY; LSE:YAU)
today announced its financial and operating results for the third quarter
ended September 30, 2009. All dollar amounts are expressed in United States
dollars unless otherwise specified.
THIRD QUARTER HIGHLIGHTS
Financial and Operating Highlights
Highlights for the three- and nine-month periods ended September 30, 2009
include:
- Total production from all mines of 314,707 gold equivalent ounces
(GEO) and 875,763 GEO, respectively;
- Average co-product cash costs(1) from continuing operations excluding
Alumbrera of $349 per GEO and $350 per GEO, respectively. By-product
cash costs from continuing operations excluding Alumbrera of $79 per
GEO and $195 per GEO, respectively;
- Revenues of $332.2 million and $783.5 million, respectively;
- Mine operating earnings of $136.4 million and $283.2 million,
respectively;
- Net earnings of $60.8 million or $0.08 per share (Net earnings and
adjusted earnings(1) were impacted by a deferred tax provision
impacting only the third quarter $0.03 per share that does not impact
operating profit or future periods) and $156.5 million or $0.21 per
share, respectively;
- Adjusted earnings of $88.3 million or $0.12 per share and $248.4
million or $0.34 per share, respectively;
Three months Nine months
ended ended
Sept 30, Sept 30,
(In millions of United States Dollars) 2009 2009
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Net earnings $ 60.8 $ 156.5
Stock-based compensation 1.8 7.0
Foreign exchange gain including discontinued
operations (6.7) (57.0)
Unrealized loss on derivatives including
discontinued operations 21.0 102.9
Future income tax expense on foreign currency
translation of inter-company debt 18.9 54.0
Non-recurring future income tax adjustment - 20.6
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Adjusted Earnings before income tax effects 95.8 284.0
Income tax effect of adjustments (7.5) (35.6)
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Adjusted Earnings $ 88.3 $ 248.4
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- Cash flow from continuing operations before changes in non-cash
working capital items(1) of $167.9 million or $0.23 per share (cash
flow from continuing operations after changes in non-cash working
capital items of $144.4 million), and $340.6 million or $0.46 per
share (Cash flow from continuing operations after changes in non-cash
working capital items of $317.0 million), respectively.
Development, Exploration and Corporate Highlights
Highlights for the three-month period ended September 30, 2009 include:
- Completed the 20 million tonnes per year expansion at Chapada with
the new mine fleet expected to commence operation in the fourth
quarter
- Completed first full quarter of commercial production at Gualcamayo
subsequent to declaring commercial production on July 1, 2009 with
production increasing 62 percent from the second quarter at cash
costs well below guidance
- Continued to accelerate development work on new veins and exploration
efforts in the North Block at El Penon with grade and throughput
improvements anticipated
- Accelerated development activities at QDD Lower West with a
conceptual study in progress
- Acquired extensive exploration concession, Caiamar, located in Brazil
- Made construction decisions for the development of C1 Santa Luz,
Mercedes and the tailings reprocessing project at Minera Florida, for
start-up in 2012.
Highlights subsequent to the quarter include:
- Announced positive exploration results at Mercedes in Mexico
- Provided update on Agua Rica in Argentina including optimization
initiatives currently underway, continued focus on updating
components of the original feasibility study, and evaluating
potential strategic partners for development
- Provided exploration update on new area 10 kilometres north of
Gualcamayo, Salamanca, where drilling results support Yamana's view
that the area represents an important source of further gold ounces
for Gualcamayo.
"Yamana again achieved record quarterly production at industry low cash
costs," said Yamana's chairman and chief executive officer, Peter Marrone. "We
focused on our newest mine, Gualcamayo, this quarter, as we continue to put
steps in place to optimize the mine. We declared commercial production on time
and in its first full quarter of commercial production the mine is meeting our
expectations and exceeding guidance. We also focused on our robust development
stage and value enhancing projects this quarter such as Agua Rica as we
continue with optimization studies and evaluating potential strategic
partners."
FINANCIAL AND OPERATING SUMMARY
Revenues for the three-month period ended September 30, 2009 were $333.2
million, representing a 50 percent increase from the comparative quarter last
year, and for the nine-month period ended were $783.5 million. Approximately
10,000 GEO were produced but not sold during the third quarter due to timing
and will be sold during the fourth quarter.
Mine operating earnings for the three-month period ended September 30,
2009 were $136.4 million, representing a 138 percent increase from the
comparative quarter last year, and for the nine-month period ended were $283.2
million.
Net earnings for the three-month period ended September 30, 2009 were
$60.8 million, or $0.08 per share, and for the nine-month period ended were
$156.5 million, or $0.21 per share. Net earnings and adjusted earnings were
impacted by a deferred tax provision impacting only the third quarter of $0.03
per share that does not impact operating profit or future periods. Adjusted
earnings for the three-month period ended September 30, 2009 were $88.3
million, representing a 180 percent increase from the comparative quarter last
year, or $0.12 per share. Adjusted earnings for the nine-month period ended
were $248.4 million, or $0.34 per share.
Cash flow from operations after changes in non-cash working capital items
for the three-month period ended September 30, 2009 was $144.4 million,
representing a 155 percent increase from the comparative period last year, and
for the nine-month period ended was $317.0 million. Cash flow from operations
before changes in non-cash working capital items for the three-month period
ended September 30, 2009 was $167.9 million or $0.23 per share, representing a
67 percent increase from the comparative period last year. Cash flow from
operations before changes in non-cash working capital items for the nine-month
period ended June 30, 2009 was $340.6 million or $0.46 per share.
Cash and cash equivalents for the three-month period ended September 30,
2009 were $97.5 million, representing a five percent increase from the second
quarter of 2009. Consistent with the business plan of the Company and as the
Company had previously indicated, the majority of the build-out would be
capital by mid 2009 with a corresponding use of available cash. Increases in
cash flow would then increase available cash. Current cash and cash
equivalents as at the end of October 31, 2009 is approximately $130 million.
Total production for all mines for the three-month period ended September
30, 2009 was 314,707 GEO (comprised of 261,789 ounces of gold and 2.9 million
ounces of silver) representing a nine percent and 16 percent increase from the
second quarter and first quarter of 2009, respectively. Total production for
the nine-month period ended was 875,763 GEO (comprised of 736,369 ounces of
gold and 7.7 million ounces of silver).
Average co-product cash costs for the three-month period ended September
30, 2009 for continuing operations excluding Alumbrera were $349 per GEO and
for the nine-month period ended were $350 per GEO. By-product cash costs for
continuing operations excluding Alumbrera for the three-month period ended
September 30, 2009 were $79 per GEO and for the nine-month period were $195
per GEO. Co-product cash costs per pound of copper at Chapada for the
three-month period ended September 30, 2009 were $1.07 per pound and for the
nine-month period ended were $0.97 per pound.
Gross margins(1) per GEO sold for the three-month period ended September
30, 2009 were $792 per GEO, representing a 55 percent increase from the
comparative period last year, and for the nine-month period ended were $703
per GEO.
"We continued to focus on cost containment and margin expansion this
quarter, which has been reflected in our double digit revenue, cash flow and
margin growth," said Chuck Main, Yamana's executive vice president finance and
chief financial officer. "We remain focused on building on our strong track
record of growth, sustainability and industry low cash costs."
Chapada, Brazil
The Company anticipated changes in the mill liners and motor replacement
at Chapada during the third quarter of 2009. Production was in line with
expectations given maintenance activities. With the expansion to 20 million
tonnes per year completed in the third quarter, fourth quarter production is
expected to increase.
El Penon, Chile
El Penon production in the third quarter of 2009 increased to 108,054
GEO, representing a 17 percent and 28 percent increase compared to the second
quarter and first quarter of 2009, respectively. Grade at El Penon also
increased in the third quarter by 13 percent and 22 percent compared to the
second and first quarter of 2009, respectively. Co-product cash costs declined
at El Penon by $15 and $42 per GEO, or 4% and 11%, compared to the second
quarter and first quarter of 2009, respectively.
Jacobina, Brazil
Jacobina continued to perform and produce at record levels. Jacobina
production of 30,978 ounces in the third quarter of 2009 increased by 12
percent and 14 percent compared to the second and first quarter of 2009,
respectively.
Gualcamayo, Argentina
Yamana continued to focus on its newest mine, Gualcamayo, to ensure
optimization of the mine. The Company declared commercial production on time
and Gualcamayo is currently meeting expectations and exceeding guidance. Third
quarter production at Gualcamayo increased to 39,523 ounces of gold,
representing a 62 percent and 93 percent increase compared to the second
quarter and first quarter of 2009, respectively. 