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Kinross (KGC) Q3 Earnings Meet Estimates, Revenues Rise Y/Y

Kinross Gold Corporation KGC delivered net earnings of $60.9 million or 5 cents per share in third-quarter 2019 against loss of $104.4 million or 8 cents in the year-ago quarter.

Barring one-time items, adjusted earnings were 8 cents per share, meeting the Zacks Consensus Estimate.

Revenues rose 16.3% year over year to $877.1 million on higher average realized gold prices.

Kinross Gold Corporation Price, Consensus and EPS Surprise

 

 

Operational Performance

Attributable gold production and sales were 608,033 and 592,689 ounces, up 3.7% and down 4.2% year over year, respectively.

Production cost of sales per gold equivalent ounce fell 5.4% year over year to $735 in the quarter. All-in sustaining cost per gold equivalent ounce sold declined 2% year over year to $1,028.

Margin per gold equivalent ounce sold was $732 in the third quarter, up 69.4% year over year.

Average realized gold prices amounted to $1,467 per ounce, up from $1,209 in the year-ago quarter.

Financial Review

Adjusted operating cash flow jumped 100.7% year over year in the third quarter to $295.4 million, supported by higher margins. Cash and cash equivalents were $358 million, down 23.8% year over year.

Long-term debt amounted to $1,836.8 million at the end of the third quarter. Notably, the company has no scheduled debt maturities due until September 2021.

Capital expenditure declined 3.9% year over year to $265.5 million in the third quarter.

Outlook

Kinross stated that it is on track to attain the production target of 2.5 million (+/- 5%) gold equivalent ounces for 2019. All-in sustaining costs are expected to be $995 (+/- 5%) per gold equivalent ounce.

The company also expects to meet the lower end of its 2019 production cost of sales guidance of $730 (+/- 5%) gold equivalent ounces and the higher end of its 2019 capital expenditure projection of $1,050 million (+/- 5%). It anticipates income tax expenses of $175-$195 million on an adjusted basis.

Price Performance

Shares of Kinross have rallied 80.9% in the past year compared with the industry’s 55.3% growth.

Zacks Rank & Others Stocks to Consider

Kinross currently sports a Zacks Rank #1 (Strong Buy).

Some other top-ranked stocks in the basic materials space are Impala Platinum Holdings Ltd. IMPUY, Franco-Nevada Corporation FNV and Agnico Eagle Mines Limited AEM, each currently flaunting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Impala Platinum has an expected earnings growth rate of 237.9% for the current fiscal year. The company’s shares have surged 280% in the past year.

Franco-Nevada has a projected earnings growth rate of 39.3% for 2019. The company’s shares have rallied 48.2% in a year.

Agnico Eagle has an estimated earnings growth rate of 168.6% for the current year. Its shares have moved up 67.6% in the past year.

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