Goldcorp Inc.’s GG third-quarter 2015 adjusted loss (excluding one-time items) came in at $37 million or 4 cents per share, as against earnings of $70 million or 9 cents per share in the year-ago quarter. The loss per share compared unfavorably with the Zacks Consensus Estimate of earnings of 5 cents.

Adjusted loss excludes one-time items including unrealized losses of $158 million or 19 cents per share from the foreign exchange translation of deferred income tax assets and liabilities.

Net loss, attributable to shareholders of Goldcorp, for the quarter was $192 million or 23 cents per share compared with net loss of $44 million or 5 cents per share a year ago.

Goldcorp, which is among the top gold producers along with Barrick Gold ABX, Newmont NEM and Kinross Gold KGC, posted revenues of $1,098 million in the reported quarter, up around 31% year over year. Revenues also beat the Zacks Consensus Estimate of $1,028 million. Average realized gold price for the quarter declined 12% to $1,114 per ounce from $1,266 per ounce in the prior-year quarter.

Gold sales increased around 47% year over year to 942,600 ounces in the reported quarter, while production increased 42% to 922,200 ounces. All-in sustaining costs were $848 per gold ounce (down 20 % year over year), while cash cost totaled $597 per ounce on a by-product basis (flat year over year) and $670 per ounce (down 1.8%) on a co-product basis.
Silver production rose roughly 45% year over year to 11.3 million ounces from 7.8 million ounces in the prior-year quarter.

Goldcorp’s shares fell around 10% to close at $13.14 last Thursday.

Mining Highlights

At the Penasquito mine, gold production was 236,800 ounces, an increase of around 83% year over year. The increase was driven by improved gold grades in sulphide as resulting from positive model reconciliation. All-in sustaining cost of $467 per ounce declined 59% year over year. Production at Penasquito is expected to exceed the 2015 guidance range of 700,000 ounces to 750,000 ounces.

Gold production at Los Filos increased roughly 10% year over year and also increased sequentially to 70,300 ounces due to higher ore processed. All-in sustaining cost was $1,442 per ounce compared with $808 per ounce in the year-ago quarter.

Gold production at Red Lake fell 22 % year over year and also declined sequentially to 77,600 ounces at an all-in sustaining cost of $1,028 per ounce. The sequential decrease was due to decreased grades from remnant pillar mining at the Campbell Complex, accelerated development in the Sulphide Zones and lower grades in the Footwall Zone.

Gold production from the Eleonore mine in Quebec totaled 86,700 ounces in the third quarter of 2015. Production increased sequentially due to expansion of underground mining and successful mine optimization initiatives.

At Porcupine in Ontario, gold production in the quarter was 71,000 ounces, down sequentially and also around 4% year over year, at an all-in sustaining cost of $882 per ounce. Production fell from the previous quarter due to lower gold grades partly offset by increased tonnage milled as a result of improved mill operations in the quarter.

Gold production at Musselwhite in Ontario increased over the prior quarter to 71,000 ounces as a result of increased mill throughput and grades.

At Pueblo Viejo, where Goldcorp holds a 40% interest and Barrick Gold holds a 60% interest, gold production rose nearly 3% year over year to 115,000 ounces (40% basis), at an all-in sustaining cost of $585 per ounce. Gold production also rose over the prior quarter due to increased tons processed, grades and recoveries.

Cerro Negro in Argentina, produced 135,700 ounces of gold in the third quarter of 2015  at an all-in sustaining cost of $731 per ounce, supported by strong ramp-up at both the Mariana Central and Eureka mines.

Financial Position

As of Sep 30, 2015, cash and cash equivalents were $257 million, down from $376 million as of Sep 30, 2014. Long-term debt was at $2,522 million as of Sep 30, 2015, compared with $2,472 million as of Sep 30, 2014. The company’s adjusted operating cash flow was $374 million in the reported quarter compared with $399 million in the year-ago quarter.

Outlook

Goldcorp reaffirmed its production guidance for 2015 and expects it to be at the top-end of 3.3 million and 3.6 million gold ounces. All-in sustaining costs are expected to be between $850 and $900 per gold ounce; $500 and $550 per ounce on a by-product basis; and $625 to $675 per ounce on a co-product basis.  

Depreciation, depletion and amortization ("DD&A") is expected to increase to $450 per gold ounce from the earlier guidance of $425 per gold ounce mainly due to production from the company’s newer and higher DD&A per ounce sites and additional assets placed in service ahead of expectations.  
The company reiterated its capital expenditure guidance and expects it to be between $1.2 billion and $1.4 billion for 2015. Corporate administration expense guidance, excluding share-based compensation, is expected to be about $170 million in 2015.

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