Iamgold's 2Q Profit Falls On Lower Production

The Associated Press

Canadian mining company Iamgold Corp. said Wednesday that its second-quarter net income fell 19 percent as gold production declined and costs rose.

The results missed Wall Street estimates and Iamgold's shares fell 2.2 percent in afternoon trading as the stock markets slid overall.

Iamgold said net income totaled $35.7 million, or 10 cents a share, in the second quarter, compared with $44.1 million, or 12 cents a share, a year earlier.

Excluding one-time items, it earned $39.1 million or 11 cents a share. Its revenue fell to $214 million from $225.3 million.

Analysts surveyed by Thomson Reuters forecast, on average, earnings of 15 cents a share on revenue of $226.1 million.

Gold production totaled 190,000 ounces, compared with 249,000 ounces a year ago, while cash costs for gold production rose to $623 an ounce from $437 an ounce.

Iamgold blamed the higher costs in part on lower-quality ore being mined at an operation in Suriname due to heavy rainfall.

The company, which is based in Toronto, increased its forecast for how much gold it will produce in 2010 to 980,000 ounces to 1.01 million ounces. It previously forecast 940,000 ounces to 1,000,000 ounces.

It now forecasts cash costs between $530 an ounce and $550 an ounce, up from $490 an ounce to $510 an ounce.

Shares of Iamgold fell 40 cents, or 2.2 percent, to $17.49 in afternoon trading.

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