Increased gold production and rising gold prices helped lift first-quarter earnings for Goldcorp Inc. (TSX:G, NYSE: GG) to US$290.9 million, or $0.40 per share.
The Vancouver-based company, Canada's second biggest gold miner, reported a 27% increase in net earnings from the same period in 2008 and said it is reinvesting its growing cash flows in key growth initiatives.
"Our focus on execution and operational excellence provided a solid start to 2009," said Chuck Jeannes, Goldcorp's president and CEO.
He added that the company's gold production grew by more than 94,000 ounces compared with last year's first quarter as nearly every one of the company's mines met or exceeded internal forecasts.
Strong gold production more than offset the impact of lower prices of byproduct metals its mines produce.
Gold sales in the first quarter increased to 607,900 ounces at a total cash cost of US$288 per ounce compared with 517,800 ounces at a total cash cost of US$238 per ounce in 2008's first quarter.
Operating cash flows totalled US$303.1 million, or $0.42 per share.
The company's Pe-asquito mine in Mexico, which Jeannes said in an earlier interview will be the foundation of Goldcorp and the primary driver to deliver 50% growth in gold production over the next five years, is on track to produce its first metals concentrates in the fourth quarter.
Goldcorp also announced plans Thursday for the development of its Cochenour project at the Red Lake gold district in Ontario.
No mineral resource yet exists for Cochenour, and the company is targeting completion of a pre-feasibility study next year. The total investment for initial development at the site during 2009, apart from a US$6 million drilling budget, is estimated at US$12 million.
In the Dominican Republic, Goldcorp expects to invest approximately US$430 million in its Pueblo Viejo joint venture with Barrick Gold Corp.
The project has a total initial capital cost of US$2.7 billion, or US$1.1 billion for Goldcorp's account.
Meanwhile, Northgate Minerals Corp. (TSX:NGX; NYSE Amex:NXG) reported first-quarter net earnings of US$21.4 million and cash flow from operations of US$45.2 million, which included cash proceeds of US$19.1 million from the early settlement of copper forward contracts.
Total gold production, including from Northgate's Kemess mine in B.C., was 107,477 ounces. That exceeded the company's first-quarter production forecast.