Yamana Gold (YRI-T, AUY-N) has reported a US$89.5-million profit for the fourth quarter of 2011. It’s a 28% decrease from the same period a year ago, following a one-time, US$81-million impairment loss on investments.
On an adjusted basis, earnings came in at US$184 million, or US25¢ a share, with a 7% increase over the comparable period.
The producer reported record-high mine operating earnings of US$297 million thanks to higher gold and silver realized prices and more concentrate sales volume. These higher prices also helped Yamana rake in a US$569-million quarterly revenue, despite the company producing 3% less, or 276,918 equivalent oz. gold, during the fourth quarter.
For the full year, Yamana had record production of 1.1 million equivalent oz. gold in a 5% boost over 2010. The company applauded its flagship operations — El Penon in Chile and Gualcamayo in Argentina — for their strong performances. Revenue was US$2.2 billion, while yearly profit came in at US$548 million, a 17% boost over 2010. Adjusted earnings amounted to US$713 million, or US96¢ a share, in a 59% jump from 2010. Operating cash flow came in at US$1.3 billion for a 48% increase from the previous year. The company ended the year with US$550 million in cash and equivalents, marking a US$220 million improvement over 2010.
The miner also boosted company-wide reserves by 11% in 2011, while growing inferred resources by 39% to more than 10 million oz.
This year Yamana expects to continue enhancing its resources and production. It has targeted production of 1.2 million to 1.3 million equivalent oz. gold for the year, representing a 13% hike over last year’s output. The company anticipates the boost will come mostly from the Mercedes gold-silver operation in Mexico, which kicked off production in November 2011, and from the Minera Florida expansion in Chile, which will start adding to production in March.
Cash costs for the year are estimated to be under US$250 per equivalent oz. gold. Last year’s costs totalled US$463 per oz.
In 2013, the company predicts between 1.5 million and 1.7 million-equivalent-oz.-gold output, shouldering a 43% increase from 2011’s level. That boost will come from a full production year at C1 Santa Luz and Ernesto-Pau-a-Pique in Brazil, and from the Pilar and the Gualcamayo expansion.
By 2014, Yamana aims to grow production to 1.75 million equivalent oz. gold.
On Feb. 22, the day it reported the 2011 results and reserve increase, Yamana boosted its annual dividend by 10% to US22¢ per share.
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