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Yamana Gold Posts Adjusted Profit In Fourth Quarter

Kitco News

(Kitco News) - Yamana Gold Inc. (TSX: YRI; NYSE: AUY) late Thursday reported an adjusted profit in the fourth quarter, although a loss when factoring in impairments and other special charges.

Adjusted earnings for the final three months of 2018 were $26.2 million, or 3 cents per share.

Yamana declared a first-quarter dividend of $0.005 per share – same as in the previous quarter -- payable to shareholders of record at the close of business on March 29 and to be distributed around April 12.

The net loss for the October-December quarter was put at $61.4 million, or 6 cents per share. This includes non-cash and other special items that reduced the company’s net income by $87.6 million, Yamana said.

For the most recent quarter, the company listed a non-cash impairment reversal of $150 million for Jacobina that was recognized following an increase in mineral reserves and mineral resources, which extends the life of the mine, and other operational improvements. This was offset by non-cash accounting impairments of $151 million for Minera Florida and $45 million due to goodwill on the acquisition of Canadian Malartic, Yamana said.

The company also reported an income-tax expense of $33.3 million based on an interpretation of tax legislation by Brazilian authorities. The company said it paid the tax to avoid penalties but is pursing legal remedies.

“In 2018, we achieved another year of exceeding our production guidance for all metals and at costs better than or in line with our guidance,” said Daniel Racine, president and chief executive officer. “Gold and copper exceeded the increased guidance levels we announced in October, while silver production exceeded the guidance that was lowered at that time.”

Fourth-quarter gold-equivalent production from Yamana Mines was 310,369 ounces, including 270,193 ounces of gold and 3.26 million ounces of silver, the company said. Total Yamana gold production was 292,484 ounces. The company also produced 39.0 million pounds of copper.

Full-year production from Yamana Mines was 1,041,350 gold-equivalent ounces, including 940,619 ounces of gold and 8.02 million ounces of silver. Copper production was 129.2 million pounds.

For 2019, Yamana looks for gold production of 940,000 ounces, comparable to last year, followed by 955,000 in 2020. Silver output is seen rising to 10 million ounces next year, while copper output is seen dipping to 120 million pounds.

Yamana also said an exploration program increased gold mineral reserves to replace 2018 mineral depletion, excluding assets that were disposed of in 2018.

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