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Kirkland Lake Gold Announces Q3 Production, Boosts Dividend

Kirkland Lake Gold Ltd. KL recently released gold production figures for the third quarter of 2020.

Consolidated gold production rose 37% year over year to 339,584 ounces in the third quarter. Consolidated gold sales rose 29.5% year over year to 331,959 ounces. The company’s average realized price of gold was $1,907 per ounce in the third quarter compared with $1,482 in the prior-year quarter.

The company witnessed quarterly production at Fosterville to rise 2% year over year to 161,489 ounces in the third quarter. Higher production reflects increased tons processed that more than offset the impacts of lower average grades.

Production from the Detour Lake Mine totaled 140,067 ounces in the third quarter, marking a 6% sequential increase from prior quarter’s levels. Increased production mostly resulted from higher processing volumes reflecting higher mining rates during third quarter. Also, higher average grades along with a greater proportion of mill feeds contributed to gold production growth in the quarter.

At Macassa, gold production totaled 38,028 ounces in the third quarter, down 39.6% year over year. Lower production mainly stemmed from lower-than-expected average grades and tons processed in third quarter of 2020. Also, mine production was affected during the quarter by lower operations related to the coronavirus pandemic.

As of Sep 30, 2020, the company’s cash position surged 58% to $848 million. It also returned a total of $141.9 million of cash to the shareholders during the third quarter. The company also declared a 50% hike in its quarterly dividend to 18.75 cents per share, which is effective fourth-quarter 2020.

The company’s shares have gained 14.9% in the past year compared with the industry’s 43.2% rise.

Zacks Rank & Key Picks

Kirkland Lake Gold currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the basic materials space are Brenntag AG BNTGY, Comstock Mining, Inc. LODE and Equinox Gold Corp. EQX, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Brenntag has an expected earnings growth rate of 2.9% for 2020. The company’s shares have surged 35.3% in the past year.

Comstock Mining has an expected earnings growth rate of 370% for 2020. Its shares have returned 132.5% in the past year.

Equinox has an expected earnings growth rate of 137.9% for 2020. The company’s shares have gained 130.1% in the past year.

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