Goldcorp Inc. (TSX:G) has reported a US$2.4 billion net loss for 2014’s fourth quarter, attributable almost entirely to a massive impairment charge recorded for its Cerro Negro mine in Argentina.
The miner took a US$2.3 billion writedown on the mine due to “the decline in market valuations of future exploration potential and the ongoing challenging fiscal conditions in Argentina.”
The loss for the quarter was more than double the US$1.1 billion loss recorded in the same period last year. Loss per share in the most recent quarter was US$2.94 compared with US$1.34 in Q4 2013.
Excluding the writedown and other adjustments, adjusted net earnings for the quarter were US$55 million, or $0.07 per share. This fell below analysts’ expectations of US$0.14 per share.
Overall results for the year, however, were more favourable than in 2013, with the company reporting a US$2.2 billion loss this year, compared with a loss of US$2.7 billion last year. Loss per share in 2014 was US$2.67, compared with US$3.27 in 2013.
Goldcorp said it achieved record gold production of 890,900 ounces in the fourth quarter – up almost 16% compared with the same period last year.
Company president and CEO Chuck Jeannes said the company expects increased production in 2015.
“Expected production growth of an additional 20% in 2015, coupled with rapidly declining capital expenditures provides a clear path to achieving significant free cash flow this year,” Jeannes said.
“Coupled with our investment grade balance sheet, Goldcorp possesses the flexibility to pursue growth opportunities that will further support our future success.”
Shares of Goldcorp were trading at $26.60 per share by the end of day February 19, which represents a drop of 8.09%.
