Eldorado Gold Corporation: 2012 Second Quarter Financial & Operating Results
VANCOUVER — Eldorado Gold Corporation is a Canadian international gold producer with seven operating mines, three mines under construction, three development projects and an extensive exploration program. We operate in China, Turkey, Brazil, Greece and Romania. One of the lowest cost gold producers, with young mines, robust margins and a strong balance sheet with a plan to produce approximately 1.7 million ounces of gold annually by 2016.
The company reports profit attributable to shareholders of the Company of $46.6 million for the period, and generates $82.1 million in cash from operating activities before changes in non-cash working capital.
Q2 2012 Key Performance Indicators and Subsequent Events
- Gold production of 140,694 ounces at an average cash operating cost of $480 per ounce (Q2 2011 gold production – 162,429 ounces at $397 per ounce).
- Gold sales of 141,717 ounces at $1,612 per ounce, including 8,798 ounces of Efemcukuru sales related to pre-commercial production (Q2 2011 gold sales – 162,164 ounces at $1,510 per ounce).
- Profit attributable to shareholders of the Company of $46.6 million or $0.07 per share (Q2 2011 – $74.9 million or $0.14 per share) was impacted by lower production from Jinfeng as well as higher corporate, exploration and tax expenses.
- Generated $82.1 million in cash from operating activities before changes in non-cash working capital – a decrease of 28% over the same quarter in 2011.
- Certej Project, Romania was granted the Environmental Permit on July 9, 2012.
- Declared a dividend of Cdn$0.06 per common share on July 26, 2012.
The Company has revised its 2012 production guidance to 660,000 ounces of gold at average cash operating costs of $465 per ounce, due to delayed treatment of Efemcukuru concentrate at the Kisladag mine and the delayed completion of construction of the Eastern Dragon project. The Company’s Kisladag, Tanjianshan, White Mountain and Jinfeng mines are forecast to produce 595,000 ounces at a cash operating cost of $471 per ounce. This performance compares favourably with beginning of year mid-range guidance of 595,000 ounces at cash operating costs of $482 per ounce. This production forecast does not include any allowance for production from the recently commissioned Olympias processing plant.
Net income for the quarter was $46.6 million (or $0.07 per share), compared with $74.9 million (or $0.14 per share) in the second quarter of 2011, a decrease of 38%. The decrease in net income year over year was due to lower earnings before taxes from gold mining operations ($18.9 million lower), as well as higher general and administrative expense ($6.1 million higher), exploration expense ($5.5 million higher) and tax expense ($5.1 million higher).
Revenues from gold sales for the quarter of $214.2 million were down $30.7 million or 13%, from the second quarter of 2011 due to lower sales volumes partially offset by higher prices. The Company sold 132,919 ounces in the second quarter of 2012 as compared with 162,164 in the second quarter of 2011. The table below details the sales volumes by mine as compared to the previous year.
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