Goldcorp Reports Record Quarterly Production, Free Cash Flow

Goldcorp (TSX:G,NYSE:GG) announced its second quarter production results, reporting 908,000 ounces of gold production and adjusted net earnings of $65 million per share. Goldcorp president and CEO Chuck Jeannes also stated that the company was “very pleased to generate positive free cash flow” after several years of investment in new mines.
As quoted in the press release, highlights from the second quarter included:

• Gold sales¹ of 903,000 ounces; gold production of 908,000 ounces.
• 2015 gold production expected toward the high end of guidance range; cost guidance narrowed and improved.
• Free cash flow⁴ of $174 million before dividends; $50 million after dividends.
• Adjusted revenues of $1.3 billion.
• All-in sustaining costs^1,5 of $846 per ounce.
• Adjusted net earnings of $65 million, or $0.08 per share.
• Adjusted operating cash flow of $358 million.
• Declared commercial production at Éléonore on April 1, 2015.
• Increased the credit facility from $2 billion to $3 billion and extended facility for 5 years.
• Completed secondary offering of Tahoe Resources shares for net proceeds of $768 million.
• Dividend per share reduced 60% to $0.02 per month effective August 1, 2015.
• Named one of Canada’s 50 Most Socially Responsible Corporations by Sustainalytics.

Jeannes stated in the release:

Higher gold grades at Peñasquito and a continued strong ramp-up at Cerro Negro drove record quarterly gold production and more than offset the slower-than-planned ramp-up at Éléonore.  In addition, a continued focus on cost efficiency and productivity enhancements along with favorable currency effects continued to push costs lower.  Our expectation is for this strong operating performance to continue and for 2015 production guidance to trend toward the high end of the current range of between 3.3 and 3.6 million ounces of gold.  In addition, we have improved our all-in sustaining cost guidance to between $850 and $900per gold ounce.
After several years of investment in our new mines, we were very pleased to generate positive free cash flow after dividends of $50 million during the quarter.  We have also taken timely actions to fortify Goldcorp’s strong financial liquidity position.  The recent sale of our 26% interest in Tahoe Resources, the $1 billion expansion of our credit facility and the dividend reduction ensure the Company has the financial flexibility to succeed in a volatile gold market.

Click here for the full press release.