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Yamana Lists 1Q Net Loss Due To Non-Cash Charges; Output Tops Guidance

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(Kitco News) - Yamana Gold Inc. (TSX: YRI; NYSE: AUY) late Wednesday reported that gold production in the first quarter exceeded the company’s expectations, although Yamana ended up with a net loss mainly due to non-cash special items.

The net loss attributable to Yamana shareholders was $160.1 million, or 17 cents per share. However, Yamana listed $170.2 million in non-cash charges, with the biggest a $174 million (before taxes) non-cash accounting carrying value reduction tied to company’s interest in Brio Gold.

Yamana’s earnings report said the adjustments amounted to 18 cents per share, meaning the company had adjusted income of a penny per share. BMO Capital Markets and Credit Suisse both said the adjusted figure was in line with consensus estimates.

Gold-equivalent production from Yamana Mines in the first quarter was 211,246 ounces, including 199,555 ounces of gold and 899,261 ounces of silver.  Total gold production was 248,088 ounces when including attributable production from Gualcamayo and Brio Gold Inc.   The company also produced 30.4 million pounds of copper. 

“Gold production exceeded plan for the first quarter with mine site costs in line with or better than plan,” Yamana said in its earnings statement. “The company reiterates production and cost guidance for 2018, and continues to expect approximately 47% of total gold production from Yamana mines and 46% of total copper production to be delivered in the first half of the year.”

This production weighting is before factoring in the company’s newest mine, Cerro Moro, where first ore was fed to the mill on April 25, Yamana said.

“The start-up is progressing well with milling rates and feed grades expected to ramp up through the second quarter, with first doré expected in May,” Yamana said, adding that Cerro Moro “is expected to contribute meaningfully” to Yamana’s planned growth at costs significantly below the current average cost structure.

The average realized gold price rose to $1,328 from $1,220 in the first quarter of 2017. All-in sustaining costs, on a byproduct basis, at Yamana mines fell to $703 from $902 a year ago.

Yamana also declared a second-quarter dividend of $0.005 per share.  Shareholders of record at the close of business on June 29 will be entitled to receive payment of this dividend on July 13, the company said. 

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