Centerra’s first quarter turns out well (November 22, 2004)

Newly minted gold producer Centerra Gold (CG-T) has shown good form out of the gate, earning US$28.7 million on revenue of US$86.7 million in the three months ended Sept. 30.

Centerra, which was spun off at the end of June to take over the gold assets of Cameco (CCO-T), owns the Kumtor mine in Kyrgyzstan and the Boroo mine in Mongolia. Consolidation of ownership in Kumtor and production from Boroo gave Centerra quarterly production of 235,579 oz. gold.

In the comparable period of 2003, the Cameco Gold business unit earned US$2.8 million on revenue of US$19.7 million; production was 69,043 oz.

Revenues for Centerra were also higher. The company realized US$398 per oz. for its gold in the quarter, a 28% increase over the previous year. The realized price in the quarter just ended was about US$3 lower than the average spot price during the period.

During the quarter, Centerra closed 155,000 oz. worth of forward sale contracts, leaving the company unhedged.