Centerra widens Q3 loss on price slide, lower sales
TORONTO (miningweekly.com) – Canadian miner Centerra Gold has widened its third-quarter loss to $18.1-million, or $0.08 a share, compared with a net loss of $3.2-million, or $0.01 a share, for the same period in 2014.
The 2015 loss was the result of a $18.7-million, or $0.08 a share, noncash impairment charge of the goodwill impairment on its flagship Kumtor mine, in the Central Asian country of Kyrgyzstan. Lower operating costs and taxes were also partially offset by fewer ounces sold and a lower average realised gold price in the quarter ended September.
The impairment on the Kumtor mine reflected a decrease in the gold price, as spot gold prices continued to decline in the first eight months of 2015, and a higher discount rate, which indicated increased country risk. This was partially offset by lower operating costs, mainly from a decline in diesel prices and favourable currency movements.
Revenue in the period fell 14% to $116.2-million, owing to 4% fewer ounces – 103 467 oz – being sold and an 11% lower average realised gold price of $1 123/oz.
Gold output for the quarter was 107 485 oz, compared with 110 792 oz in the comparative 2014 quarter. The decrease in ounces reflected lower production at Boroo, in Mongolia, as a result of the milling operations having stopped in December 2014. Kumtor's output grew 9% in the third quarter, owing to higher mill throughput and recoveries, partially offset by lower grades.
All-in sustaining costs declined 10% year-on-year to $1 000/oz sold.
Despite the political uncertainty surrounding its Kumtor mine, Centerra’s TSX-listed stock had gained nearly 50% in value during the last 12 months, closing on Tuesday at C$8.17 apiece.
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